As filed with the Securities and Exchange
Commission on October 7, 2005                      Registration No. ____________
================================================================================

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                                -----------------

                                    FORM SB-2
                             REGISTRATION STATEMENT
                                    UNDER THE
                             SECURITIES ACT OF 1933
                                -----------------

                               BLUE HOLDINGS, INC.
                 (Name of Small Business Issuer in its Charter)

            NEVADA                                              2300            
   (State or Jurisdiction of                        (Primary Standard Industrial
Incorporation or Organization)                       Classification Code Number)

                                   88-0450923
                                 (I.R.S Employer
                               Identification No.)


                              5804 E. SLAUSON AVE.
                               COMMERCE, CA 90040
                                 (323) 725-5555
          (Address and Telephone Number of Principal Executive Offices)

                              5804 E. SLAUSON AVE.
                               COMMERCE, CA 90040
     (Address of Principal Place of Business or intended Place of Business)

                      PATRICK CHOW, CHIEF FINANCIAL OFFICER
                               BLUE HOLDINGS, INC.
                              5804 E. SLAUSON AVE.
                               COMMERCE, CA 90040
                                 (323) 725-5555


                                    Copy to:

                           ALBERT P. ASATOORIAN, ESQ.
                         STUBBS ALDERTON & MARKILES, LLP
                       15821 VENTURA BOULEVARD, SUITE 525
                            ENCINO, CALIFORNIA 91436
                                 (818) 444-4500
            (Name, Address and Telephone Number of Agent for Service)

Approximate  date of proposed  sale to the  public:  From time to time after the
effective date of this Registration Statement.

If any of the  securities  being  registered on this Form are being offered on a
delayed or continuous  basis  pursuant to Rule 415 under the  Securities  Act of
1933, check the following box. [X]

If this form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, please check the following box and list
the  Securities  Act  registration  statement  number of the  earlier  effective
registration statement for the same offering.

If this form is a  post-effective  amendment filed pursuant to Rule 462(c) under
the  Securities  Act,  check  the  following  box and  list the  Securities  Act
registration  statement number of the earlier effective  registration  statement
for the same offering.

If this form is a  post-effective  amendment filed pursuant to Rule 462(d) under
the  Securities  Act,  check  the  following  box and  list the  Securities  Act
registration  statement number of the earlier effective  registration  statement
for the same offering.

If delivery of the prospectus is expected to be made pursuant to Rule 434, check
the following box.






                         CALCULATION OF REGISTRATION FEE


   TITLE OF EACH CLASS                     PROPOSED MAXIMUM       PROPOSED         AMOUNT OF
     OF SECURITIES        AMOUNT TO BE     OFFERING PRICE    MAXIMUM AGGREGATE    REGISTRATION
    TO BE REGISTERED      REGISTERED (1)     PER UNIT (2)    OFFERING PRICE (2)        FEE
----------------------------------------------------------------------------------------------
                                                                             
Common Stock, par value 
   $.001 per share....     3,000,000 (3)         $8.525           $25,575,000         $3,011
----------------------------------------------------------------------------------------------
    TOTAL                  3,000,000                              $25,575,000         $3,011


(1)   In  the  event  of  a  stock  split,  stock  dividend,  or  other  similar
      transaction  involving the Registrant's  common stock, in order to prevent
      dilution, the number of shares registered shall automatically be increased
      to cover the  additional  shares in accordance  with Rule 416(a) under the
      Securities Act.
(2)   Estimated  solely for the  purpose of  calculating  the  registration  fee
      pursuant  to Rule  457(c)  under  the  Securities  Act of 1933,  using the
      average  of the high and low  price as  reported  on the  Over-the-Counter
      Bulletin Board on October 3, 2005.
(3)   The  securities  being  registered  may at various  times be issued by the
      Registrant at indeterminate prices.

THE REGISTRANT HEREBY AMENDS THIS  REGISTRATION  STATEMENT ON SUCH DATE OR DATES
AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE TIME UNTIL THE REGISTRANT  SHALL FILE
A FURTHER AMENDMENT WHICH SPECIFICALLY  STATES THAT THIS REGISTRATION  STATEMENT
SHALL  THEREAFTER  BECOME  EFFECTIVE  IN  ACCORDANCE  WITH  SECTION  8(A) OF THE
SECURITIES  ACT OF  1933  OR  UNTIL  THE  REGISTRATION  STATEMENT  SHALL  BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION,  ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
================================================================================





                  Subject to Completion, Dated October 7, 2005

                               BLUE HOLDINGS, INC.

                                3,000,000 SHARES
                                  COMMON STOCK

                                   ----------

         This prospectus relates to the offer and sale of up to 3,000,000 shares
of our  common  stock,  which  we may  sell  from  time  to  time in one or more
offerings.  We will provide specific terms of these sales in supplements to this
prospectus. You should read this prospectus and each supplement carefully before
you invest.  This  prospectus may not be used by us to offer and sell securities
unless accompanied by a prospectus supplement.

         Our common stock is quoted on the Over-The-Counter Bulletin Board under
the symbol  "BLHL." On October 3, 2005,  the last  reported  sales  price of the
common stock on the Over-The-Counter Bulletin Board was $8.85 per share.

         INVESTING  IN OUR  COMMON  STOCK  INVOLVES  RISKS.  SEE "RISK  FACTORS"
BEGINNING ON PAGE 3.

                                   ----------


         Neither the Securities and Exchange Commission nor any state securities
commission has approved or  disapproved  of these  securities or passed upon the
accuracy or adequacy of this prospectus. Any representation to the contrary is a
criminal offense.

                                   ----------


                  The date of this prospectus is ______________


                                       i



                                TABLE OF CONTENTS

                                     PAGE                                   PAGE
                                     ----                                   ----

Prospectus Summary.................  1     Executive Compensation........   30
Risk Factors.......................  3     Principal Shareholders........   34
Forward-looking Statements.........  10    Related Party Transactions....   36
Use of Proceeds....................  11    Description of Capital Stock..   40
Market for Common Equity and               Plan of Distribution..........   43
   Related Shareholder Matters.....  11    Legal Matters.................   44
Management's Discussion and                Experts.......................   44
   Analysis of Financial Condition         Where You Can Find
   and Results of Operations.......  12       More Information...........   44
Business...........................  19    Index to Financial
Management.........................  28       Statements.................   F-1



                              ABOUT THIS PROSPECTUS

         This  prospectus is part of a Registration  Statement on Form SB-2 that
we filed  with the  Securities  and  Exchange  Commission  utilizing  a  "shelf"
registration  process.  Under this shelf  process,  we may sell up to  3,000,000
shares  of  common  stock  from  time to time  in one or  more  offerings.  This
prospectus provides you with a general description of the securities that may be
offered.  Each time we sell any securities  through the shelf process under this
prospectus,  we will provide a prospectus  supplement that will contain specific
information about the terms of that offering. The prospectus supplement may also
add, update or change information contained in this prospectus.  You should read
both this  prospectus and any  prospectus  supplement  together with  additional
information  described  below  under  the  heading  "Where  You  Can  Find  More
Information."

         You should rely only on the information contained in this prospectus or
any supplement.  We have not authorized  anyone to provide  information  that is
different from that contained in this prospectus.  The information  contained in
this prospectus is accurate only as of the date of this  prospectus,  regardless
of the time of delivery of this prospectus or of any sale of our common stock.

         Except as otherwise indicated,  information in this prospectus reflects
a 1-for-29  reverse  stock split of our common stock which took effect on and as
of June 7, 2005.


                                       ii



                               PROSPECTUS SUMMARY

         THIS  SUMMARY  HIGHLIGHTS  SELECTED  INFORMATION  CONTAINED  IN GREATER
DETAIL  ELSEWHERE  IN THIS  PROSPECTUS.  THIS  SUMMARY  DOES NOT CONTAIN ALL THE
INFORMATION YOU SHOULD CONSIDER BEFORE INVESTING IN OUR COMMON STOCK. YOU SHOULD
READ THE ENTIRE  PROSPECTUS  CAREFULLY  BEFORE  MAKING AN  INVESTMENT  DECISION,
INCLUDING  "RISK  FACTORS" AND THE  CONSOLIDATED  FINANCIAL  STATEMENTS  AND THE
RELATED NOTES. REFERENCES IN THIS PROSPECTUS TO "BLUE HOLDINGS," "WE," "OUR" AND
"US" REFER TO BLUE HOLDINGS, INC. AND OUR CONSOLIDATED SUBSIDIARIES.

                                  OUR BUSINESS

         We design,  develop,  market and distribute  high end fashion jeans and
accessories  under the brand name "Antik  Denim," and as of July 5, 2005,  under
the brand name "Yanuk." We plan to also design,  develop,  market and distribute
jeans and  accessories  under other  brands that we may license or acquire  from
time to time. Our products include jeans,  jackets,  belts, purses and T-shirts.
We currently  sell our products in the United  States,  and  internationally  in
countries  that  include,  but are not  limited  to,  Canada,  Belgium,  France,
Germany,  Sweden,  Italy, Korea, Mexico and Japan, directly to department stores
and  boutiques  and  through   distribution   arrangements  in  certain  foreign
jurisdictions.  We are  headquartered  in Commerce,  California and maintain two
showrooms in New York and Los Angeles.

                                  OUR INDUSTRY

         We operate in the high end fashion denim industry.  Our competitors are
companies  such as Levi  Strauss,  Calvin  Klein,  Joe's  Jeans,  True  Religion
Apparel,  Seven For All Mankind and Citizens of Humanity.  Our competitive  edge
lies in our  ability  to create  innovative  concepts  and  designs,  to develop
products  with  extraordinary  fit, and to expand our high  quality  fabrics and
finishes,  treatments and embellishments  (including our patent pending pockets,
hand stitching and embroidery detail).

                       OUR HISTORY AND CONTACT INFORMATION

         Blue Holdings, Inc. was incorporated in the State of Nevada on February
9, 2000 under the name Marine Jet Technology  Corp.  From our inception  through
January 2005, we focused on developing and marketing boat propulsion technology.
Between  January  and  February  2005,  we entered  into  separate  transactions
whereby, among other matters,  Keating Reverse Merger Fund, LLC ("KRM Fund"), an
existing  shareholder of the Company,  agreed to purchase a substantial majority
of our outstanding common stock, and Intellijet  Marine,  Inc., a company formed
by our former majority shareholder and principal executive officer and director,
Jeff P.  Jordan,  acquired  all of our boat  propulsion  technology  assets  and
assumed all of our then existing liabilities.

         Between  February  4, 2005 and April 29,  2005,  we existed as a public
"shell"  company  with  nominal  assets  whose sole  business  was to  identify,
evaluate and investigate various companies to acquire or with which to merge.

         On April 14, 2005, we entered into an Exchange Agreement (the "Exchange
Agreement") with Antik Denim,  L.L.C., a California  limited  liability  company
("Antik"), the members of Antik (the "Antik Members"), and KRM Fund. The closing
of the transactions contemplated by the Exchange Agreement occurred on April 29,
2005. At the closing, we acquired all of the outstanding membership interests of
Antik  (the  "Interests")  from  the  Antik  Members,   and  the  Antik  Members
contributed  all of their  Interests to us. In exchange,  we issued to the Antik
Members 843,027 shares of our Series A Convertible  Preferred  Stock,  par value
$0.001 per share (the "Preferred Shares"), which, as a result of the approval by
a substantial majority of our outstanding  shareholders entitled to vote and the
approval  by  our  Board  of  Directors,   of  amendments  to  our  Articles  of
Incorporation  that (i) changed our name to Blue Holdings,  Inc., (ii) increased
our authorized number of shares of common stock to 75,000,000, and (iii) adopted
a 1-




for-29 reverse stock split, on June 7, 2005 converted into 708,984,875 shares of
our common stock on a pre-reverse stock split basis and 24,447,783 shares of our
common stock on a post-reverse stock split basis.

         At the closing, Antik became our wholly-owned subsidiary.  The exchange
transaction was accounted for as a reverse merger  (recapitalization) with Antik
deemed  to be the  accounting  acquirer,  and we  were  deemed  to be the  legal
acquirer.

         As a result of the  closing  of the  transactions  contemplated  by the
Exchange  Agreement,  the Antik Members (together with Elizabeth Guez, our Chief
Operating  Officer,   and  Patrick  Chow,  our  Chief  Financial  Officer)  hold
approximately  93.7% of the  outstanding  shares of our  common  stock,  and our
shareholders  existing  immediately prior to the closing hold approximately 3.8%
of our outstanding shares of common stock.

         The address of our principal  executive  office is 5804 E. Slauson Ave.
Commerce, CA 90040, and our telephone number is (323) 725-5555.

                                  THE OFFERING

Common stock offered by us.............         Up to 3,000,000 shares

Offering price at which common 
   stock may be offered and 
   sold by us from time to time .......         At such  price  or prices as may
                                                be negotiated between us and any
                                                purchaser from time to time.

Common stock outstanding
   before this offering................         25,557,200 shares

Common stock to be outstanding
   after this offering.................         28,557,200 shares

Use of proceeds........................         Proceeds from the sale of common
                                                stock  by us will  be  used  for
                                                general   working   capital  and
                                                other  purposes  as we  may  set
                                                forth  from  time to time in any
                                                prospectus supplement.  See "Use
                                                of Proceeds."

OTC Bulletin Board symbol..............         BLHL

Risk Factors...........................         See "Risk Factors"  beginning on
                                                page  3  for  a  discussion   of
                                                factors that you should consider
                                                carefully   before  deciding  to
                                                purchase our common stock.

         In the table above,  the number of shares to be outstanding  after this
offering is based on 25,557,200  shares  outstanding  as of October 3, 2005, and
the assumed sale of all 3,000,000 shares of common stock that may be offered and
sold by us under this prospectus and any applicable prospectus  supplement.  The
number of shares to be  outstanding  after this  offering  does not  reflect the
issuance of the following shares which are not being offered for sale under this
prospectus:

         o        62,000 shares issuable upon the exercise of outstanding  stock
                  options  at a  weighted  average  exercise  price of $8.10 per
                  share, as of October 3, 2005; and


                                       2



         o        2,438,000  additional  shares  reserved for issuance under our
                  2005 Stock Incentive Plan, as of October 3, 2005.

                                  RISK FACTORS

         INVESTING  IN OUR  COMMON  STOCK  INVOLVES A HIGH  DEGREE OF RISK.  YOU
SHOULD CAREFULLY  CONSIDER THE FOLLOWING RISK FACTORS AND ALL OTHER  INFORMATION
CONTAINED IN THIS PROSPECTUS  BEFORE  PURCHASING OUR COMMON STOCK. THE RISKS AND
UNCERTAINTIES  DESCRIBED BELOW ARE NOT THE ONLY ONES FACING US. ADDITIONAL RISKS
AND UNCERTAINTIES  THAT WE ARE UNAWARE OF, OR THAT WE CURRENTLY DEEM IMMATERIAL,
ALSO MAY BECOME IMPORTANT  FACTORS THAT AFFECT US. IF ANY OF THE FOLLOWING RISKS
OCCUR,  OUR  BUSINESS,  FINANCIAL  CONDITION OR RESULTS OF  OPERATIONS  COULD BE
MATERIALLY AND ADVERSELY AFFECTED. IN THAT CASE, THE TRADING PRICE OF OUR COMMON
STOCK COULD DECLINE, AND YOU MAY LOSE SOME OR ALL OF YOUR INVESTMENT.

                          RISKS RELATED TO OUR BUSINESS

ANTIK, OUR WHOLLY-OWNED  SUBSIDIARY,  HAS A LIMITED OPERATING HISTORY, MAKING IT
DIFFICULT TO EVALUATE WHETHER IT WILL OPERATE PROFITABLY.

         Antik was formed in  September  2004 to design,  develop,  manufacture,
market, distribute and sell high end fashion jeans, apparel and accessories.  As
a result, it does not have a meaningful  historical record of sales and revenues
nor an established  business track record. While our management believes that we
have an opportunity to be successful in the high end fashion jean market,  there
can be no assurance  that we will be  successful in  accomplishing  our business
initiatives,  or that we will achieve any significant level of revenues, or ever
recognize  net income,  from the sale of our products.  Unanticipated  problems,
expenses and delays are  frequently  encountered  in increasing  production  and
sales and  developing  new  products,  especially  in the  current  stage of our
business. Our ability to continue to successfully develop,  produce and sell our
products  and to  generate  significant  operating  revenues  will depend on our
ability to, among other matters:

         o        successfully market, distribute and sell our products or enter
                  into  agreements with third parties to perform these functions
                  on our behalf; and

         o        obtain the financing required to implement our business plan.

         Given Antik's limited  operating  history,  our new license  agreements
with Yanuk,  our lack of long-term  sales  history and other sources of revenue,
there can be no  assurance  that we will be able to achieve any of our goals and
develop a sufficiently large customer base to be profitable.

WE MAY REQUIRE ADDITIONAL CAPITAL IN THE FUTURE.

         We may not be able to fund our  future  growth or react to  competitive
pressures if we lack sufficient funds.  Currently,  management  believes we have
sufficient  cash on hand and cash available  through our factor to fund existing
operations for the foreseeable  future.  However,  in the future, we may need to
raise  additional  funds  through  equity or debt  financings  or  collaborative
relationships,  including  in the event that we lose our  relationship  with our
factor.  This additional  funding may not be available or, if available,  it may
not be available on economically reasonable terms.

         We cannot  assure you that we will  complete  any sale of shares  under
this prospectus and any applicable prospectus supplement or that the sale of the
shares under this  prospectus and any applicable  prospectus  supplement will be
completed on otherwise  commercially  reasonable terms. In addition, any further
funding may result in significant dilution to existing shareholders. If adequate
funds are not available on commercially  acceptable terms, we may be required to
curtail our


                                       3



operations or obtain funds through collaborative partners that may require us to
release material rights to our products.

FAILURE TO MANAGE OUR GROWTH AND EXPANSION COULD IMPAIR OUR BUSINESS.

         Management  believes  that we,  including  our Antik  Denim  subsidiary
specifically,  are poised for significant growth in 2005 and 2006.  However,  no
assurance can be given that we will be successful in  maintaining  or increasing
our sales in the  future.  Any future  growth in sales will  require  additional
working capital and may place a significant strain on our management, management
information systems,  inventory  management,  sourcing capability,  distribution
facilities and receivables  management.  Any disruption in our order processing,
sourcing or  distribution  systems  could cause orders to be shipped  late,  and
under  industry  practices,  retailers  generally can cancel orders or refuse to
accept goods due to late shipment.  Such  cancellations and returns would result
in a reduction in revenue,  increased  administrative  and shipping  costs and a
further burden on our distribution facilities.

         Additionally, we intend from time to time to open and/or license retail
stores  focusing  on the Antik  Denim,  Yanuk and other  brands,  and to acquire
and/or  license  other  businesses  and  brands,  as  applicable,   as  we  deem
appropriate.  If we are unable to adequately manage our retail operations, or to
properly integrate any business or brands we acquire and/or license,  this could
adversely affect our results of operation and financial condition.

WE CURRENTLY OWN OR LICENSE,  AND OPERATE, TWO PRINCIPAL BRANDS, ANTIK DENIM AND
YANUK. IF WE ARE UNSUCCESSFUL IN MARKETING AND  DISTRIBUTING  THOSE BRANDS OR IN
EXECUTING  OUR  OTHER  STRATEGIES,  OUR  RESULTS  OF  OPERATIONS  AND  FINANCIAL
CONDITION WILL BE ADVERSELY AFFECTED.

         While our goal is to employ a multi-brand strategy that will ultimately
diversify  the  fashion and other risks  associated  with  reliance on a limited
product  line,  we  currently  operate,  directly  and through our  wholly-owned
subsidiary,  Antik Denim,  L.L.C., two principal brands,  Antik Denim and Yanuk,
one of  which,  Yanuk,  is being  operated  pursuant  to a very  recent  license
agreement.  If we are unable to  successfully  market and  distribute  the Antik
Denim and Yanuk  brands,  or if the recent  popularity  of premium  denim brands
decreases, or if we are unable to execute on our multi-brand strategy to acquire
and/or license additional companies and/or brands, as applicable,  identified by
our  management  from time to time,  our  results of  operations  and  financial
condition will be adversely affected.

OUR OPERATING RESULTS MAY FLUCTUATE SIGNIFICANTLY.

         Management  expects that we will experience  substantial  variations in
our net sales and operating results from quarter to quarter. We believe that the
factors which influence this variability of quarterly results include:

         o        the timing of its introduction of new product lines;

         o        the level of consumer acceptance of each new product line;

         o        general economic and industry  conditions that affect consumer
                  spending and retailer purchasing;

         o        the availability of manufacturing capacity;

         o        the seasonality of the markets in which it participates;

         o        the timing of trade shows;

         o        the product mix of customer orders;


                                       4



         o        the  timing  of the  placement  or  cancellation  of  customer
                  orders;

         o        the weather;

         o        transportation delays;

         o        quotas and other regulatory matters;

         o        the occurrence of charge backs in excess of reserves; and

         o        the timing of  expenditures in anticipation of increased sales
                  and actions of competitors.

         As a result of fluctuations in our revenue and operating  expenses that
may occur, management believes that period-to-period  comparisons of our results
of  operations  are  not a good  indication  of our  future  performance.  It is
possible that in some future quarter or quarters,  our operating results will be
below the  expectations of securities  analysts or investors.  In that case, our
common stock price could fluctuate significantly or decline.

THE FINANCIAL CONDITION OF OUR CUSTOMERS COULD AFFECT OUR RESULTS OF OPERATIONS.

         Certain retailers, including some of our customers, have experienced in
the past,  and may  experience  in the  future,  financial  difficulties,  which
increase  the risk of  extending  credit  to such  retailers  and the risk  that
financial  failure will  eliminate a customer  entirely.  These  retailers  have
attempted to improve their own operating  efficiencies  by  concentrating  their
purchasing  power among a narrowing group of vendors.  There can be no assurance
that we will remain a preferred vendor for our existing customers. A decrease in
business from or loss of a major customer  could have a material  adverse effect
on our results of  operations.  There can be no  assurance  that our factor will
approve the extension of credit to certain retail customers in the future.  If a
customer's  credit is not approved by the factor, we could assume the collection
risk on sales to the customer itself, require that the customer provide a letter
of credit, or choose not to make sales to the customer.

OUR BUSINESS IS SUBJECT TO RISKS ASSOCIATED WITH IMPORTING PRODUCTS.

         A portion of our import  operations  are subject to tariffs  imposed on
imported  products and quotas  imposed by trade  agreements.  In  addition,  the
countries  in which our  products  are  imported  may from  time to time  impose
additional new duties, tariffs or other restrictions on its imports or adversely
modify  existing  restrictions.  Adverse  changes  in  these  import  costs  and
restrictions,  or our suppliers' failure to comply with customs or similar laws,
could harm our business.  We cannot assure that future trade agreements will not
provide our competitors with an advantage over us, or increase our costs, either
of which could have an adverse effect on our business and financial condition.

         Our operations are also subject to the effects of  international  trade
agreements and regulations such as the North American Free Trade Agreement,  and
the activities and regulations of the World Trade Organization. Generally, these
trade  agreements  benefit our  business by reducing or  eliminating  the duties
assessed on products or other materials  manufactured  in a particular  country.
However, trade agreements can also impose requirements that adversely affect our
business,  such as  limiting  the  countries  from  which  we can  purchase  raw
materials and setting  duties or  restrictions  on products that may be imported
into the United States from a particular country.

         Our  ability to import  raw  materials  in a timely and  cost-effective
manner may also be affected by problems at ports or issues that otherwise affect
transportation and warehousing providers, such as labor disputes. These problems
could require us to locate  alternative ports or warehousing  providers to avoid
disruption to our customers.  These  alternatives  may not be available on short
notice or could  result in higher  transit  costs,  which  could have an adverse
impact on our business and financial condition.


                                       5



OUR  DEPENDENCE  ON  INDEPENDENT  MANUFACTURERS  AND  SUPPLIERS OF RAW MATERIALS
REDUCES OUR ABILITY TO CONTROL THE MANUFACTURING  PROCESS,  WHICH COULD HARM OUR
SALES, REPUTATION AND OVERALL PROFITABILITY.

         We depend on independent  contract  manufacturers  and suppliers of raw
materials to secure a sufficient supply of raw materials and maintain sufficient
manufacturing and shipping capacity in an environment characterized by declining
prices,  labor  shortage,  continuing  cost pressure and  increased  demands for
product  innovation and  speed-to-market.  This  dependence  could subject us to
difficulty in obtaining  timely delivery of products of acceptable  quality.  In
addition, a contractor's failure to ship products to us in a timely manner or to
meet the required  quality  standards  could cause us to miss the delivery  date
requirements of our customers.  The failure to make timely  deliveries may cause
our  customers  to  cancel   orders,   refuse  to  accept   deliveries,   impose
non-compliance charges through invoice deductions or other charge-backs,  demand
reduced  prices or reduce  future  orders,  any of which  could  harm our sales,
reputation and overall profitability.

         We do  not  have  long-term  contracts  with  any  of  our  independent
contractors  and any of  these  contractors  may  unilaterally  terminate  their
relationship with us at any time. While management believes that there exists an
adequate  supply of contractors  to provide  products and services to us, to the
extent we are not able to  secure or  maintain  relationships  with  independent
contractors  that are able to fulfill its  requirements,  our business  would be
harmed.

         We  have  initiated  standards  for  our  suppliers,  and  monitor  our
independent  contractors'  compliance with applicable  labor laws, but we do not
control our  contractors  or their labor  practices.  The  violation of federal,
state or foreign labor laws by one of our  contractors  could result in us being
subject to fines and our goods that are  manufactured  in violation of such laws
being seized or their sale in interstate commerce being prohibited.  To date, we
have not been subject to any sanctions  that,  individually or in the aggregate,
have had a material adverse effect on our business,  and we are not aware of any
facts on which any such  sanctions  could be based.  There can be no  assurance,
however,  that in the future we will not be subject to  sanctions as a result of
violations of applicable labor laws by our  contractors,  or that such sanctions
will  not  have a  material  adverse  effect  on our  business  and  results  of
operations.

WE MAY NOT BE ABLE TO ADEQUATELY PROTECT OUR INTELLECTUAL PROPERTY RIGHTS.

         The loss of or inability to enforce our  trademark  "Antik  Denim," our
licensed  trademark  "Yanuk"  or  any  of  our  other  proprietary  or  licensed
trademarks,  designs, patents, know-how and trade secrets could adversely affect
our  business.  If any third  party  copies  or  otherwise  gains  access to our
trademarks  or  other   proprietary   rights,   or  develops   similar  products
independently,  it may be costly to enforce  our rights and we would not be able
to compete as  effectively.  Additionally,  the laws of  foreign  countries  may
provide  inadequate  protection  of  intellectual  property  rights,  making  it
difficult to enforce such rights in those countries.

         We  may  need  to  bring  legal   claims  to  enforce  or  protect  our
intellectual   property   rights.   Any   litigation,   whether   successful  or
unsuccessful,  could result in substantial costs and diversions of resources. In
addition,  notwithstanding  the  rights  we  have  secured  in our  intellectual
property,  third  parties  may bring  claims  against us  alleging  that we have
infringed  on  their  intellectual  property  rights  or that  our  intellectual
property  rights are not valid.  Any claims  against us, with or without  merit,
could be time  consuming  and costly to defend or litigate and  therefore  could
have an adverse affect on our business.

THE LOSS OF PAUL GUEZ OR OUR LEAD DESIGNERS  WOULD HAVE AN ADVERSE EFFECT ON OUR
FUTURE  DEVELOPMENT  AND COULD  SIGNIFICANTLY  IMPAIR OUR ABILITY TO ACHIEVE OUR
BUSINESS OBJECTIVES.


                                       6



         Our success is largely  dependent  upon the  expertise and knowledge of
our  Chairman,  Chief  Executive  Officer  and  President,  Paul Guez,  our lead
designers, Philippe Naouri and Alexandre Caugant, and our ability to continue to
hire and retain other key  personnel.  The loss of Mr. Guez, or any of our other
key  personnel,   could  have  a  material   adverse  effect  on  our  business,
development, financial condition, and operating results. We do not maintain "key
person" life insurance on any of our management or key personnel,  including Mr.
Guez.

                         RISKS RELATED TO OUR INDUSTRY

OUR SALES ARE HEAVILY INFLUENCED BY GENERAL ECONOMIC CYCLES.

         Apparel  is a cyclical  industry  that is  heavily  dependent  upon the
overall level of consumer spending.  Purchases of apparel and related goods tend
to be highly  correlated with cycles in the disposable  income of our consumers.
Our customers  anticipate and respond to adverse changes in economic  conditions
and uncertainty by reducing  inventories and canceling orders. As a result,  any
substantial deterioration in general economic conditions,  increases in interest
rates,  acts of war,  terrorist  or  political  events  that  diminish  consumer
spending and confidence in any of the regions in which we compete,  could reduce
our sales and adversely affect our business and financial condition.

OUR BUSINESS IS HIGHLY COMPETITIVE AND DEPENDS ON CONSUMER SPENDING PATTERNS.

         The  apparel  industry  is highly  competitive.  We face a  variety  of
competitive challenges including:

         o        anticipating  and  quickly  responding  to  changing  consumer
                  demands;

         o        developing  innovative,  high-quality  products  in sizes  and
                  styles that appeal to consumers;

         o        competitively  pricing our  products  and  achieving  customer
                  perception of value; and

         o        the need to provide strong and effective marketing support.

WE MUST SUCCESSFULLY  GAUGE FASHION TRENDS AND CHANGING CONSUMER  PREFERENCES TO
SUCCEED.

         Our success is largely  dependent upon our ability to gauge the fashion
tastes of our customers and to provide  merchandise  that  satisfies  retail and
customer demand in a timely manner. The apparel business fluctuates according to
changes in consumer  preferences  dictated in part by fashion and season. To the
extent we misjudge  the market for our  merchandise,  our sales may be adversely
affected.  Our ability to anticipate and effectively respond to changing fashion
trends depends in part on our ability to attract and retain key personnel in our
design,  merchandising  and marketing staff.  Competition for these personnel is
intense,  and we  cannot be sure that we will be able to  attract  and  retain a
sufficient number of qualified personnel in future periods.

OUR BUSINESS MAY BE SUBJECT TO SEASONAL TRENDS.

         In the experience of our management,  operating results in the high end
fashion denim  industry have been subject to seasonal  trends when measured on a
quarterly basis. This trend is dependent on numerous factors, including:

         o        the markets in which we operate;

         o        holiday seasons;

         o        consumer demand;

         o        climate;


                                       7



         o        economic conditions; and

         o        numerous other factors beyond our control.


            OTHER RISKS RELATED TO AN INVESTMENT IN OUR COMMON STOCK

THE SALE OF  SECURITIES  BY US IN ANY EQUITY OR DEBT  FINANCING  COULD RESULT IN
DILUTION TO OUR EXISTING  SHAREHOLDERS AND HAVE A MATERIAL ADVERSE EFFECT ON OUR
EARNINGS.

         Any sale of shares by us pursuant to this prospectus and any applicable
prospectus supplement,  or in a future private placement offering,  could result
in dilution to the existing  shareholders  as a direct result of our issuance of
additional  shares of our capital stock. In addition,  our business strategy may
include   expansion   through  internal  growth,   by  acquiring   complementary
businesses,  by acquiring or licensing  additional  brands,  or by  establishing
strategic  relationships with targeted  customers and suppliers.  In order to do
so, or to fund our other  activities,  we may issue additional equity securities
that  could  dilute  our  shareholders'  stock  ownership.  We may  also  assume
additional  debt and incur  impairment  losses  related  to  goodwill  and other
tangible assets if we acquire another company and this could  negatively  impact
our results of operations.

INSIDERS OWN A SIGNIFICANT  PORTION OF OUR COMMON  STOCK,  WHICH COULD LIMIT OUR
SHAREHOLDERS' ABILITY TO INFLUENCE THE OUTCOME OF KEY TRANSACTIONS.

         At October 3,  2005,  our Chief  Executive  Officer,  Paul Guez,  Chief
Operating Officer,  Elizabeth Guez, Chief Financial  Officer,  Patrick Chow, and
three members of our design team, Messrs.  Naouri,  Caugant and Meyer Abbou, all
former members of Antik, owned  approximately 93.7% of the outstanding shares of
our common stock. Paul and Elizabeth Guez alone own  approximately  72.1% of the
outstanding  shares of our common  stock at October  3, 2005.  Accordingly,  our
executive  officers and key personnel have the ability to affect the outcome of,
or  exert  considerable   influence  over,  all  matters  requiring  shareholder
approval,  including  the election  and removal of  directors  and any change in
control.  This  concentration  of  ownership  of our common stock could have the
effect  of  delaying  or  preventing  a change  of  control  of us or  otherwise
discouraging  or  preventing  a potential  acquirer  from  attempting  to obtain
control of us. This, in turn,  could have a negative  effect on the market price
of our common stock.  It could also prevent our  shareholders  from  realizing a
premium over the market prices for their shares of common stock.

OUR STOCK PRICE HAS BEEN VOLATILE.

         Our common stock is quoted on the Over-The-Counter  Bulletin Board, and
there can be substantial volatility in the market price of our common stock. The
market  price of our common  stock has been,  and is likely to  continue  to be,
subject  to  significant  fluctuations  due to a variety of  factors,  including
quarterly variations in operating results, operating results which vary from the
expectations  of  securities  analysts  and  investors,   changes  in  financial
estimates,  changes in market valuations of competitors,  announcements by us or
our competitors of a material nature,  loss of one or more customers,  additions
or  departures of key  personnel,  future sales of common stock and stock market
price and volume fluctuations.

         In  addition,  general  political  and  economic  conditions  such as a
recession,  or interest rate or currency rate  fluctuations may adversely affect
the market price of our common stock.  In addition,  the stock market in general
has  experienced  extreme price and volume  fluctuations  that have affected the
market price of our common stock.  Often,  price  fluctuations  are unrelated to
operating  performance of the specific companies whose stock is affected. In the
past,  following periods of volatility in the market price of a company's stock,
securities class action litigation has occurred against the issuing company.  If
we were  subject  to this  type of  litigation  in the  future,  we could  incur
substantial costs and a diversion of our


                                       8



management's  attention  and  resources,  each of which  could  have a  material
adverse effect on our revenue and earnings.  Any adverse  determination  in this
type of litigation could also subject us to significant liabilities.

PURCHASERS IN THIS OFFERING MAY IMMEDIATELY  EXPERIENCE  SUBSTANTIAL DILUTION IN
NET TANGIBLE BOOK VALUE.

         We plan to sell shares at various times pursuant to this prospectus and
an applicable  prospectus supplement at a price or prices that we will negotiate
with potential purchasers from time to time. Because our common stock has in the
past been sold at prices  lower than the price that you may pay,  you may suffer
immediate  substantial dilution in net tangible book value, which represents the
amount of the  company's  total  tangible  assets  less its  total  liabilities,
divided by the number of shares of its outstanding  capital stock.  The exercise
of options may result in further dilution.

ABSENCE OF DIVIDENDS COULD REDUCE OUR ATTRACTIVENESS TO INVESTORS.

         Some investors  favor  companies that pay  dividends,  particularly  in
general  downturns  in the stock  market.  We have not declared or paid any cash
dividends on our common stock. We currently intend to retain any future earnings
for funding growth, and we do not currently  anticipate paying cash dividends on
our common stock in the  foreseeable  future.  Because we may not pay dividends,
your return on this  investment  likely  depends on your  selling our stock at a
profit.


                                       9



                           FORWARD-LOOKING STATEMENTS

         This  prospectus,  including  the  sections  entitled  "Risk  Factors,"
"Management's  Discussion  and  Analysis of Financial  Condition  and Results of
Operations" and "Business," contains  "forward-looking  statements" that include
information relating to future events, future financial performance, strategies,
expectations, competitive environment, regulation and availability of resources.
These  forward-looking   statements  include,  without  limitation,   statements
regarding:  proposed new services; our statements concerning litigation or other
matters; statements concerning projections, predictions, expectations, estimates
or  forecasts  for our  business,  financial  and  operating  results and future
economic performance; statements of management's goals and objectives; and other
similar expressions concerning matters that are not historical facts. Words such
as  "may,"  "will,"  "should,"   "could,"  "would,"   "predicts,"   "potential,"
"continue," "expects,"  "anticipates,"  "future," "intends," "plans," "believes"
and "estimates," and similar expressions, as well as statements in future tense,
identify forward-looking statements.

         Forward-looking  statements should not be read as a guarantee of future
performance or results,  and will not necessarily be accurate indications of the
times at, or by which,  that  performance  or those  results  will be  achieved.
Forward-looking  statements are based on information  available at the time they
are made and/or  management's  good faith belief as of that time with respect to
future  events,  and are  subject to risks and  uncertainties  that could  cause
actual  performance or results to differ  materially  from those expressed in or
suggested by the forward-looking statements.  Important factors that could cause
these differences include, but are not limited to:

         o        our failure to  implement  our  business  plan within the time
                  period we originally planned to accomplish; and

         o        other factors  discussed  under the headings  "Risk  Factors,"
                  "Management's  Discussion and Analysis of Financial  Condition
                  and Results of Operations" and "Business."

         Forward-looking statements speak only as of the date they are made. You
should not put undue reliance on any  forward-looking  statements.  We assume no
obligation  to update  forward-looking  statements  to reflect  actual  results,
changes in  assumptions  or changes in other factors  affecting  forward-looking
information,  except to the extent required by applicable securities laws. If we
do update one or more forward-looking  statements,  no inference should be drawn
that  we  will  make   additional   updates  with  respect  to  those  or  other
forward-looking statements.


                                       10



                                 USE OF PROCEEDS

         Unless otherwise indicated in the applicable prospectus supplement,  we
anticipate  that any net  proceeds  from the sale of the shares of common  stock
that  we may  offer  under  this  prospectus  and  any  accompanying  prospectus
supplement  will be used  for  general  corporate  purposes.  General  corporate
purposes  may include  acquisitions,  investments,  repayment  of debt,  capital
expenditures, repurchase of our capital stock and any other purposes that we may
specify in any prospectus supplement. We may invest the net proceeds temporarily
until we use them for their stated purpose.

                            MARKET FOR COMMON EQUITY
                         AND RELATED SHAREHOLDER MATTERS

COMMON STOCK

         Our common stock is quoted on the Over-The-Counter Bulletin Board under
the symbol "BLHL." The following  table sets forth,  for the periods  indicated,
the high and low bid  information  for the  common  stock,  as  determined  from
sporadic quotations on the Over-the-Counter Bulletin Board, as well as the total
number of shares of common  stock  traded  during  the  periods  indicated.  The
information  has been adjusted to reflect a 1-for-29  reverse stock split of our
common stock which took effect on June 7, 2005, after the periods presented. The
following  quotations  reflect  inter-dealer  prices,  without  retail  mark-up,
mark-down or commission and may not represent actual transactions.

                                               HIGH                   LOW
                                               ----                   ---
YEAR ENDED DECEMBER 31, 2003
     First Quarter....................    Not available          Not available
     Second Quarter...................    Not available          Not available
     Third Quarter....................    Not available          Not available
     Fourth Quarter...................    $8.70                  $1.74

YEAR ENDED DECEMBER 31, 2004
     First Quarter....................    $4.06                  $2.90
     Second Quarter...................    $4.06                  $2.03
     Third Quarter....................    $14.79                 $2.03
     Fourth Quarter...................    $2.47                  $1.16

YEAR ENDED DECEMBER 31, 2005
     First Quarter....................    $17.40                 $1.02
     Second Quarter...................    $28.71                 $4.64
     Third Quarter....................    $9.60                  $8.09

         On October 3, 2005,  the  closing  sales  price of our common  stock as
reported on the Over-The-Counter  Bulletin Board was $8.85 per share. At October
3, 2005, there were approximately 67 record holders of our common stock.

DIVIDENDS

         We have never paid  dividends on our common stock.  We intend to retain
our future earnings to re-invest in our ongoing business.


                                       11



         MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
                             RESULTS OF OPERATIONS

         THE FOLLOWING  DISCUSSION SHOULD BE READ TOGETHER WITH OUR CONSOLIDATED
FINANCIAL  STATEMENTS AND RELATED NOTES,  AS WELL AS THE SECTION  ENTITLED "RISK
FACTORS," THAT APPEAR ELSEWHERE IN THIS PROSPECTUS.

OVERVIEW

         We,  directly  and through our  wholly-owned  subsidiary,  Antik Denim,
L.L.C.,  which was  formed in  September  2004,  design,  develop,  manufacture,
market, distribute and sell high end fashion jeans, apparel and accessories.  We
market,  distribute  and sell "Antik  Denim" and, as a result of recent  license
agreement  with  Yanuk,  "Yanuk"  brand  products  in  the  United  States,  and
internationally  in  countries  that  include,  but are not limited to,  Canada,
Belgium,  France,  Germany,  Sweden,  Italy, Korea, Mexico and Japan. We plan to
also design,  develop,  market and distribute jeans and accessories  under other
brands that we may license or acquire from time to time.

         We market and  distribute  our  products by  participating  in industry
trade shows,  as well as through our show rooms in Los Angeles and New York.  We
maintain  distributor  relationships  in the United  Kingdom,  France,  Germany,
Sweden,  Greece,  Belgium,  Italy,  Mexico and Japan.  With respect to the Antik
Denim brand,  except for Mexico and Japan we currently have no exclusive or long
term distribution  agreements with any party covering any territory,  and do not
depend on any single distributor to distribute our products. With respect to the
Yanuk brand, except for Mexico and Japan, we currently have no exclusive or long
term distribution  agreements with any party covering any territory,  and do not
depend on any single  distributor to distribute our products.  Our  distributors
often,  but not always,  purchase  products  from us at a discount for resale to
their customers in their respective territories.  Our distributors warehouse our
products  at their  expense  and they ship to and  collect  payment  from  their
customers directly.

         Our products  are sold in the United  States to  department  stores and
boutiques  such  as Saks  Fifth  Avenue,  Neiman  Marcus,  Nordstrom,  Barney's,
Bloomingdales,  Bergdorf Goodman,  Atrium,  Fred Segal,  Intermix,  Kitson,  and
Bendel, as well as smaller boutiques throughout the country.

         Our  products  are  sold   internationally  to  department  stores  and
boutiques such as Lane Crawford in Hong Kong,  Harrods and Harvey Nichols in the
United Kingdom,  Barneys and Isetan in Japan, Galleries Lafayette in France, and
Holt Renfrew in Canada.

         We  intend to  operate  certain  flagship  stores  domestically  and to
license overseas  operators to open retail stores that focus on high end fashion
denim  generally,  and the Antik Denim and Yanuk brands,  in  particular.  While
there is no existing plan with respect to the roll-out of such stores, the first
retail store was opened on August 27, 2005 on Melrose Avenue in Los Angeles.

         We also intend to license our proprietary owned and licensed trademarks
with  respect to products  that we believe are not in our core line of business.
While there is no existing  plan with  respect to the types of products to which
we intend to license our  proprietary  trademarks,  on September 8, 2005,  Antik
entered into a term sheet license  agreement  with Titan  Industries,  Inc. that
provides  Titan with an exclusive  right to use the "Antik Denim"  trademark for
the sale of men's and women's  footwear in the United States and its possessions
and territories, Canada and Mexico, and a right of first refusal for similar use
of the trademark in Europe and South America.

         Our  historical  operations  prior to April 29, 2005  discussed in this
section reflect only the operations of Antik Denim, L.L.C., a California limited
liability company. Prior to April 29, 2005, Blue 


                                       12



Holdings,  Inc.,  formerly  known as  Marine  Jet  Technology  Corp.,  since its
inception and through  January 2005,  focused on developing  and marketing  boat
propulsion  technology.  Between  January and  February  2005,  we entered  into
separate transactions whereby, among other matters, Keating Reverse Merger Fund,
LLC ("KRM Fund"), an existing  shareholder of the Company,  agreed to purchase a
substantial  majority of our outstanding  common stock,  and Intellijet  Marine,
Inc.,  a  company  formed  by our  former  majority  shareholder  and  principal
executive  officer  and  director,  Jeff P.  Jordan,  acquired  all of our  boat
propulsion technology assets and assumed all of our then existing liabilities.

         Between  February  4, 2005 and April 29,  2005,  we existed as a public
"shell"  company  with  nominal  assets  whose sole  business  was to  identify,
evaluate and investigate various companies to acquire or with which to merge.

         On  April  29,  2005,  Blue  Holdings,  Inc.  consummated  an  exchange
transaction in which all of the outstanding membership interests of Antik Denim,
L.L.C., a privately-held  California limited liability  company,  were exchanged
for 843,027 shares of Blue Holdings,  Inc. Series A Convertible Preferred Stock,
par value $0.001 per share,  which,  on June 7, 2005,  converted into 24,447,783
shares of Blue Holdings, Inc. common stock, on a post-reverse stock split basis.
Antik Denim, L.L.C. was formed in September 2004.

         At the closing, Antik became our wholly-owned subsidiary.  The exchange
transaction was accounted for as a reverse merger  (recapitalization) with Antik
deemed  to be the  accounting  acquirer,  and we  were  deemed  to be the  legal
acquirer.

RESULTS OF OPERATIONS

                             SUMMARY FINANCIAL DATA

         The  following  historical  financial  information  should  be  read in
conjunction with the audited and unaudited financial statements and the notes to
those  statements,  included  elsewhere in this  prospectus.  The  statements of
operations  data with  respect  to the six months  ended  June 30,  2005 and the
period September 13, 2004 (inception) to December 31, 2004 and the balance sheet
data at June 30, 2005 are derived  from,  and are qualified by reference to, the
audited  and  unaudited   financial   statements   included  elsewhere  in  this
prospectus.  See footnote 1 below.  The historical  results are not  necessarily
indicative of results to be expected for any future periods.

                                                                      Period
                                                                   September 13,
                                                     Six Months        2004
                                                       Ended            to
                                                      June 30,     December 31,
                                                        2005           2004    
                                                    ------------   ------------
                                                     (Unaudited)     (Audited)

CONSOLIDATED STATEMENT OF
OPERATIONS DATA:
Sales, net ......................................   $  8,854,228   $    365,290
Selling, Distribution and Administrative Expenses   $  2,192,334   $    838,700
Net Income (Loss) ...............................   $  1,658,562   $ (1,131,755)
Basic and diluted earnings (Loss) per share .....   $       0.07   $      (0.05)
Weighted-average common shares outstanding ......     25,441,628     24,447,783


                                       13



                                                       June 30,     December 31,
                                                         2005            2004
                                                      ----------      ----------
                                                      (Unaudited)
CONSOLIDATED BALANCE SHEET DATA:
Cash and cash equivalents ......................      $   31,539      $   73,823
Working capital ................................      $3,554,428      $   28,572
Total Assets ...................................      $6,629,327      $1,416,968
Total liabilities ..............................      $2,867,892      $1,377,913
Total shareholders' / members' equity ..........      $3,761,435      $   39,055


(1)      On April 29, 2005,  Blue Holdings,  Inc.  (formerly known as Marine Jet
Technology Corp.) acquired all the membership  interests in Antik Denim,  L.L.C.
in exchange for 843,027  shares of its preferred  stock,  each of which would be
convertible  into 841 shares of Blue Holdings' common stock. The acquisition was
accounted for as a reverse merger  (recapitalization)  with Blue Holdings,  Inc.
deemed  to be the  legal  acquirer,  and Antik  Denim,  L.L.C.  deemed to be the
accounting acquirer. Accordingly, the historical financial information presented
herein  is that of  Antik  Denim,  L.L.C.  as  adjusted  to give  effect  to any
difference in the par value of the issuer's and the accounting  acquirer's stock
with the offset to capital in excess of par value. Accordingly,  our results for
the period from Antik's inception (September 13, 2004) to December 31, 2004, and
for the six months ended June 30, 2005 are not  comparable to the  corresponding
prior periods and no comparative data has been presented.

FROM SEPTEMBER 13, 2004 (INCEPTION) TO DECEMBER 31, 2004.

         We recorded net sales of $0.37 million for the period from September 13
through  December 31, 2004.  Gross profit for the period was $0.21  million,  or
57%.

         Selling, distribution and administrative expenses totaled $0.84 million
and included  purchases of sample  fabric,  freight,  advertising,  commissions,
travel and trade show expense. The principal components were sample costs ($0.14
million),  professional fees ($0.13 million), and reimbursement to Blue Concept,
LLC on administrative and selling expenses including rent, utilities,  insurance
and payroll ($0.37 million).

         Net loss before  provision  for taxes was $1.13  million.  The loss was
created by the need of the start-up operations to finance operating expenses and
cover the  non-cash  development  costs of $0.5  million  attributed  to pending
patent and trademark  applications  and proprietary  designs and design concepts
contributed by certain of Antik's former members.

         Net cash used by operating activities was ($0.45 million).  The deficit
was caused by the need to build up  inventories  of $0.8  million and to finance
accounts receivable amounting to $0.13 million.  This deficit was financed by an
increase  in  accounts  payable  by $1  million  and due to  customers  by $0.09
million.  Cash from financing activities included net contributions from members
totaling $0.67 million and loans from related parties of $0.25 million.

SIX MONTHS ENDED JUNE 30, 2005

         We recorded  sales of $8.85  million for the six months ending June 30,
2005.  Sales in 2005 are related to sales of  products by Antik.  During the six
months,  we had total sales of $0.7 million to Blue Concept Europe  Limited,  an
entity  owned by the  principal  shareholder.  Gross  profit  for the six months
ending June 30, 2005 was $4.46 million,  or 50%.  Management  expects that sales
will continue to increase in the quarter ended September 30, 2005,  although the
rate of this increase will depend on the  co-ordination  of our vendors to catch
up with the increased amount of purchase orders.


                                       14



         Selling, distribution and administrative expenses totaled $2.19 million
and included  purchases of sample  fabric,  freight,  advertising,  commissions,
travel and trade show expense.  The principal  components were  professional and
consulting  fees ($0.52  million),  and fees paid to Blue  Concept,  LLC under a
service agreement ($0.63 million) (see P.33 Related Party Transactions).

         Net income after provision for taxes was $1.66 million.  Other than the
minimum tax of $800 for the State of California,  previous members of Antik have
agreed not to require distributions for their individual tax liabilities for the
period up to the exchange transaction.  Therefore, our tax provisions were based
on the income between April 30 and June 30, 2005. Net Income was affected in the
second quarter by the costs associated with the exchange transaction with Antik,
namely $0.30 million on  professional  fees and $0.18 million in accrual for the
cost of issuing 102,079 post-reverse-stock-split shares as a finders' fee to the
facilitator of the transaction.

LIQUIDITY AND CAPITAL RESOURCES

         Net cash used by operating activities for the six months ended June 30,
2005 was ($0.66  million).  The  deficit  was  created by an  increase  of $3.42
million  in  inventory  and was  financed  by an  increase  of $1.29  million in
accounts  payable  and by  additional  contributions/paid-in  capital  of  $0.69
million from Mr. Guez.

         Since  the  beginning  of 2005,  Mr.  Guez has  personally  contributed
$1,200,000 in fabric inventory and $686,200 in cash to Antik. From time to time,
he also  supports  us with  temporary  advances.  As of June  30,  2005,  we had
advances totaling $141,549 from Mr. Guez.

         We use a factor for Antik for working capital and credit administration
purposes.  Under the  factoring  agreement,  the factor  purchases a substantial
portion of the trade  accounts  receivable  and  assumes  all  credit  risk with
respect to such accounts.

         The factor  agreement,  which terminates on October 18, 2005,  provides
that Antik can borrow an amount up to 85% of the value of our approved  factored
customer  invoices,  less a reserve of 15% of unpaid accounts purchased and 100%
of all such accounts which are disputed.  As of June 30, 2005, the amount of the
reserve held by the factor was approximately  $464,000. The factor commission is
0.08% of the customer  invoice amount for terms up to 90 days,  plus one quarter
of one percent (.25%) for each additional  thirty-day term. The factor agreement
has been amended to terminate on July 24, 2006 and includes  Blue  Holdings Inc.
as an additional borrower. The amendments,  dated to be effective July 25, 2005,
also make available to both Blue Holdings Inc and Antik Denim, L.L.C. a combined
line of credit up to $1.5  million  against  inventory.  We can  borrow  against
inventory up to 33.3% of the value of eligible raw materials and finished goods.
By another amendment dated September 1, 2005, the advance ratio against approved
factored  invoices has been revised to 90%.  Furthermore,  the credit facilities
will automatically be renewed after July 24, 2006 and will thereafter be subject
to 120 days' termination notice from either party.

         Receivables  sold in excess of maximums  established  by the factor are
subject to  recourse in the event of  nonpayment  by the  customer.  At June 30,
2005,  items  subject to recourse  approximated  $998,863.  We are  contingently
liable to the factor for merchandise  disputes,  customer claims and the like on
receivables sold to the factor.

         To the extent that we draw funds prior to the deemed collection date of
the accounts  receivable sold to the factor,  interest is charged at the rate of
1% over  the  factor's  prime  lending  rate  per  annum.  Factor  advances  are
collateralized by the factored and non-factored accounts receivable, inventories
and 


                                       15



the personal guarantee of Mr. Guez and Blue Concept,  LLC, a company co-owned by
him and Elizabeth Guez.

         Our primary  source of liquidity is expected to be cash flow  generated
from  operations,  cash and cash  equivalents  currently  on hand,  and  working
capital  attainable  through our factor.  Additionally,  we intend to sell up to
3,000,000 shares of our common stock pursuant to this prospectus and one or more
applicable prospectus supplements,  which could enhance our liquidity.  However,
we can give no assurance  that will be able to complete any sale of these shares
on commercially favorable terms, or at all.

         Additionally,  pursuant to the  provisions  of the  Exchange  Agreement
among us, Antik,  and the members of Antik, the members of Antik agreed that, in
the event that our shareholders'  equity (on a consolidated  basis following the
closing of the  transactions  contemplated by that agreement) as reported in our
Quarterly  Report  on Form  10-QSB  for the  quarter  ended  June 30,  2005 (the
"Consolidated  Equity") was less than $5,000,000,  the members would contribute,
within  fifteen (15) days following the filing of such periodic  report,  equity
capital to us in an amount equal to the  difference  between  $5,000,000 and the
actual   Consolidated   Equity  reported  in  such  periodic  report  ("Required
Contribution").  In the case of such  Required  Contribution,  each of the Antik
members  agreed  that no  additional  shares of the our  capital  stock would be
issued in  consideration  of such  Required  Contribution,  and  therefore,  the
existing shareholders,  including Antik's members, would not be further diluted.
On June 27, 2005, we, Antik,  Antik's former members (i.e., the members of Antik
prior  to  the  closing  of  the  transactions   contemplated  by  the  Exchange
Agreement), and Keating Reverse Merger Fund, a beneficiary of certain provisions
of the Exchange  Agreement,  amended the Exchange  Agreement to require that the
Required  Contribution  is to be  made,  if  at  all,  in  connection  with  the
Registrant's Quarterly Report on Form 10-QSB for the quarter ended September 30,
2005.

OFF-BALANCE SHEET ARRANGEMENTS

         At  June  30,  2005  and  December  31,  2004,  we  did  not  have  any
relationships with unconsolidated  entities or financial  partnerships,  such as
entities often referred to as structured  finance,  variable interest or special
purpose  entities,  which  would  have  been  established  for  the  purpose  of
facilitating  off-balance sheet  arrangements or other  contractually  narrow or
limited  purposes.  As such,  we are not  exposed to any  financing,  liquidity,
market or credit risk that could arise if we had engaged in such relationships.

CONTRACTUAL OBLIGATIONS

         The following summarizes our contractual obligations at August 31, 2005
and the effects such obligations are expected to have on liquidity and cash flow
in future periods:



                                                         PAYMENTS DUE BY PERIOD
                                     --------------------------------------------------------------
                                                  LESS THAN 1      1-3          3-5         AFTER
                                        TOTAL        YEAR         YEARS        YEARS       5 YEARS
                                     ----------   ----------   ----------   ----------   ----------
                                                                                 
Operating leases .................   $2,298,021   $  206,062   $  434,013   $  464,925   $1,193,021
Employment obligations ...........   $1,172,308   $  240,000   $  480,000   $  452,308
                                     ----------   ----------   ----------   ----------   ----------
     Total contractual obligations   $3,470,329   $  446,062   $  914,013   $  917,233   $1,193,021
                                     ==========   ==========   ==========   ==========   ==========


         On July 8, 2005, we entered into an Employment  Agreement with Philippe
Naouri based on the foregoing  letter  agreement  entered into with Antik.  This
agreement was amended on August 23, 2005.  Pursuant to the terms of Mr. Naouri's
employment  agreement,  as  amended,  Mr.  Naouri was engaged by us as a fashion
director  and  senior  vice   president   in  charge  of  design,   development,
manufacturing,  


                                       16



marketing  and wholesale of apparel and related  accessories  bearing the "Antik
Denim"  trademark  for a term  of 5  years  commencing  on  July  11,  2005  and
terminating  on July 10,  2010.  Mr.  Naouri  will  receive an annual  salary of
$240,000.

         On August  27,  2005,  the  Company  opened a retail  store on  Melrose
Avenue,  Los Angeles,  California and took over all the obligations of a 10-year
property  lease which was entered  into by Blue  Concept LLC in April 2005.  The
lease will expire on March 15, 2015.

         CRITICAL ACCOUNTING POLICIES, JUDGMENTS AND ESTIMATES

         Revenue is recognized when merchandise is shipped to the customer based
upon agreed  terms and is recorded net of  estimated  returns,  charge backs and
markdowns based upon management's estimates and historical experience.

         Trade  accounts  receivable  are  recorded  at invoiced  amounts,  less
amounts accrued for returns,  discounts and allowances. An allowance is provided
for specific  customer  accounts  where  collection is doubtful and for inherent
risk in ultimate  collectibility.  There is no off-balance sheet credit exposure
related to customer receivables.

         Inventories  are  stated  at the  lower  of  cost  or  market.  Cost is
determined on the first-in, first -out ("FIFO") method.

         The  preparation of financial  statements in conformity with accounting
principles  generally  accepted  in  the  United  States  of  America,  requires
management to make estimates and assumptions that affect the reported amounts of
assets and  liabilities  and disclosure of contingent  assets and liabilities at
the date of the financial  statements  and the reported  amounts of revenues and
expenses  during the reporting  period.  Actual  results could differ from these
estimates

RECENT ACCOUNTING PRONOUNCEMENTS

         In December  2004,  the FASB issued  Statement of Financial  Accounting
Standard  ("SFAS") No. 123R "Share Based  Payment." This statement is a revision
of SFAS  Statement  No.  123,  "Accounting  for  Stock-Based  Compensation"  and
supersedes APB Opinion No. 25,  "Accounting  for Stock Issued to Employees," and
its related  implementation  guidance.  SFAS 123R  addresses  all forms of share
based  payment  ("SBP")  awards  including  shares issued under  employee  stock
purchase plans, stock options,  restricted stock and stock appreciation  rights.
Under SFAS 123R, SBP awards result in a cost that will be measured at fair value
on the awards'  grant  date,  based on the  estimated  number of awards that are
expected to vest.  This statement  will become  effective for the company at the
first quarter of 2006.  The Company has evaluated the effects of the adoption of
this  pronouncement and has determined it will not have a material impact on the
Company's financial statements.

         In March, 2005, the Securities and Exchange Commission's ("SEC") Office
of the  Chief  Accountant  and its  Division  of  Corporation  Finance  released
Financial Accounting Bulletin No. 107,  "Share-Based Payment" (SAB 107). SAB 107
provides  interpretive  guidance related to the interaction between Statement of
Financial  Accounting  Standard No. 123R "Shared Based  Payment" (SFAS 123R) and
certain SEC rules and regulations.  SAB 107 provides the staff's views regarding
the valuation of  shared-based  payment  arrangements  for public  companies and
stresses the importance of including appropriate disclosures within SEC filings,
particularly during the transition to SFAS 123R.


                                       17


         In  December  2004,  the  FASB  issued  SFAS  No.  153,  "Exchanges  of
Nonmonetary  Assets,  an amendment to APB Opinion No. 29" ("SFAS No. 153"). SFAS
No. 153 amends  Accounting  Principles  Board  Opinion No. 29,  "Accounting  for
Nonmonetary  Transactions",  to require that exchanges of nonmonetary  assets be
measured and accounted for at fair value, rather than at carryover basis, of the
assets  exchanged.  Nonmonetary  exchanges  that lack  commercial  substance are
exempt  from  this  requirement.  SFAS  No.  153 is  effective  for  nonmonetary
exchanges  entered into in fiscal  periods  beginning  after June 15, 2005.  The
Company does not routinely enter into nonmonetary  exchanges.  Accordingly,  the
Company  does  not  expect  that  the  adoption  of SFAS  No.  153  will  have a
significant  effect  on  the  Company's  financial  statement   presentation  or
disclosures.


                                       18



                                    BUSINESS

CORPORATE HISTORY

         Blue Holdings, Inc., formerly known as Marine Jet Technology Corp., was
incorporated  in the state of Nevada on February 9, 2000.  From its inception up
to January 20,  2005,  the Company  focused on  developing  and  marketing  boat
propulsion technology developed by Jeff P. Jordan.

         Prior to our inception,  Mr. Jordan was granted  several patents in the
United  States,  the European  Union,  Australia and New Zealand.  These patents
protect various elements of a marine propulsion system that Mr. Jordan developed
with Robert J. Tomlinson. Also prior to our formation, Mr. Jordan asked David L.
Lyman,  who owned and operated a  contract-manufacturing  firm, to assist in the
design of a prototype  engine.  Mr. Lyman would assist in making the  propulsion
system suitable for mass production using automated equipment.

         On May 19, 2000, we entered into a Proprietary  Rights  Agreement  with
Mr.  Lyman,  whereby  we  received  any and all  proprietary  rights  and future
benefits derived from Mr. Lyman's design,  development and work on the prototype
propulsion system. Pursuant to this agreement, we issued 1,000,000 shares of our
common  stock to Mr.  Lyman.  The value of Mr.  Lyman's  proprietary  rights was
negotiated between and among Messrs. Lyman, Jordan and Tomlinson.

         On May 19, 2000, we entered into a Technology  License  Agreement  with
Messrs. Jordan and Tomlinson. In accordance with this agreement,  Messrs. Jordan
and Tomlinson  assigned the rights to three United States  patents they owned as
individuals,  as well as any  improvements,  reissues  or  extensions  of  those
patents in the United  States or abroad to the  Company.  In exchange  for these
patent rights,  we issued an aggregate of 15,875,000 shares of our common stock,
of which Mr. Jordan received 14,287,500 common shares and Mr. Tomlinson received
1,587,500 shares of common stock.

         In August of 2001, we purchased  assets from Mr.  Jordan for cash.  The
assets  included  a test boat,  patterns  for  component  castings  and  related
equipment.  During 2002 and 2003, Mr. Jordan  continued to develop the prototype
system in the test boat and developed various designs to improve the performance
of the prototype system.  This led to the development of the Variable Marine Jet
design,  our  second  generation  system,  which  was the  subject  of a  Patent
Cooperation Treaty (PCT) patent filing in December 2003.

         We developed a fully operational prototype propulsion system,  referred
to as the  first  generation  system,  which  served  as a test bed for  further
development.  This system underwent testing, research and further development by
our management.

         We intended to develop  marine jet  propulsion  systems for sale and to
license the rights to manufacture such systems and/or boats  incorporating  such
technology under the name "Quick Jet." We sought to develop and market the Quick
Jet  technology  to produce a  proprietary  marine jet  propulsion  system  that
offered  the  low-speed  thrust and  acceleration  of a propeller  drive,  while
retaining the safety,  convenience  and  maneuverability  of a  traditional  jet
design.

         We intended to market our water-jet system for commercial use under the
name  "WorkJET."  With more thrust at low boat  speeds and larger load  carrying
capacity than previous  marine engine types,  our  management  believed that the
WorkJET  would  operate  efficiently  both inshore and in heavy seas. It has the
shallow draft of a jet, yet the stability, sea-keeping and dynamic breaking of a
propeller in big swells.  We believed that this market was ideal for our product
because jet propulsion  systems are preferred in the fishing  industry for their
shallow draft and ability to operate over nets.


                                       19



         Our goal was to sell the Quick Jet system in combination with available
marine motors to boat  manufacturers,  who would produce boats incorporating the
licensed  technology.  Since  our  inception,  the  Company  has been  unable to
generate  significant  revenue from this  business  plan.  In January  2005,  we
determined that we were unable to further pursue our business plan of developing
marine jet propulsion systems for sale and licensing of the manufacturing rights
without  raising  significant  additional  financing  needed for further  patent
filings, Variable Marine Jet prototype development,  marketing expenses, working
capital and to fund the significant expense of operating as a public company.

         On January 11, 2005,  Mr.  Jordan  entered  into a Securities  Purchase
Agreement  ("Purchase  Agreement")  with Keating  Reverse Merger Fund, LLC ("KRM
Fund"), under which KRM Fund agreed to purchase,  and Mr. Jordan agreed to sell,
an  aggregate  of  15,306,500  shares  of our  common  stock  owned by him for a
purchase price of $440,000, or $0.029 per share.

         On January 20, 2005, we entered into an Assumption  Agreement  with Mr.
Jordan and Intellijet Marine, Inc. ("Intellijet"),  a Nevada corporation that we
established as a wholly-owned  subsidiary.  Under the Assumption  Agreement,  we
transferred all of our assets,  except for 21,822,570  shares of common stock of
Intellijet and approximately $2,500 in cash, to Intellijet. Intellijet agreed to
assume all of our  liabilities  and obligations and to indemnify us for any loss
we incur with respect to the assumed liabilities. Mr. Jordan and Intellijet also
agreed to release us from any and all obligations and claims whatsoever.

         On February 4, 2005, we completed the  distribution  of all  21,822,570
shares of common stock of Intellijet owned by us pro rata to our shareholders of
record  as of  January  24,  2005.  Pursuant  to the  distribution,  each of our
shareholders received one share of common stock of Intellijet for each one share
of our common stock owned of by our shareholders on the record date.  Intellijet
is now an independent  company and will continue to operate our former  business
of developing marine jet propulsion technology;  supplying mechanical components
under the Quick JetTM brand name;  and licensing boat  manufacturers  to produce
boats incorporating Intelllijet's systems.

         Mr.  Jordan  completed  the sale of his  Company  shares to KRM Fund on
February  9,  2005.  After the  transfer  of our  marine  propulsion  assets and
business to Intellijet,  the Company was a public  "shell"  company with nominal
assets,  liabilities or ongoing  operations whose sole business was to identify,
evaluate and investigate various companies to acquire or with which to merge.

         On April 14, 2005, we entered into an Exchange Agreement (the "Exchange
Agreement") with Antik Denim,  L.L.C., a California  limited  liability  company
("Antik"), the members of Antik (the "Antik Members"), and KRM Fund. The closing
of the transactions contemplated by the Exchange Agreement occurred on April 29,
2005. At the closing, we acquired all of the outstanding membership interests of
Antik  (the  "Interests")  from  the  Antik  Members,   and  the  Antik  Members
contributed  all of their  Interests to us. In exchange,  we issued to the Antik
Members 843,027 shares of our Series A Convertible  Preferred  Stock,  par value
$0.001 per share (the "Preferred Shares"), which, as a result of the approval by
a substantial majority of our outstanding  shareholders entitled to vote and the
approval  by  our  Board  of  Directors,   of  amendments  to  our  Articles  of
Incorporation  that (i) changed our name to Blue Holdings,  Inc., (ii) increased
our authorized number of shares of common stock to 75,000,000, and (iii) adopted
a 1-for-29  reverse  stock split,  on June 7, 2005  converted  into  708,984,875
shares of our common  stock on a  pre-reverse  stock split basis and  24,447,783
shares of our common stock on a post-reverse stock split basis.

         At the closing, Antik became our wholly-owned subsidiary.  The exchange
transaction was accounted for as a reverse merger  (recapitalization) with Antik
deemed to be the accounting acquirer, and us deemed to be the legal acquirer.


                                       20



         As a result of the  closing  of the  transactions  contemplated  by the
Exchange  Agreement,  the Antik Members (together with Elizabeth Guez, our Chief
Operating  Officer,   and  Patrick  Chow,  our  Chief  Financial  Officer)  hold
approximately  93.7% of the  outstanding  shares of our  common  stock,  and our
shareholders  existing  immediately prior to the closing hold approximately 3.8%
of our outstanding shares of common stock.

         Following the closing of the transactions  contemplated by the Exchange
Agreement,  Paul Guez,  one of the former Antik  Members,  became our  Chairman,
Chief Executive Officer and President.  Mr. Guez has over 30 years experience in
the apparel industry and is best known as the founder of Sasson Jeans,  which he
founded in 1976.  Since 1989,  Mr.  Guez has  engaged in the design,  marketing,
manufacturing   and  wholesale   distribution   of  premium  fashion  and  denim
collections,  including for a growing stable of contemporary  brands, such as U,
Taverniti So Jeans, Duarte Jeans, Elvis, Memphis Blues and Grail Jeans.

         Additionally,  Philippe  Naouri and  Alexandre  Caugant,  French  denim
innovators,  Antik's  principal  designers,  and two of the former Antik Members
continue  to  provide  design  services  to us.  Mr.  Naouri  has worked on such
international brands as Diesel, Levi's and G-Star, and Mr. Caugant has worked on
the GOA brand in France.

RECENT DEVELOPMENTS

         On  July  5,  2005,  we  entered  into a  ten-year  License  Agreement,
effective July 1, 2005, with Yanuk Jeans, LLC ("Yanuk").  Under the terms of the
License Agreement, we became the exclusive licensor for the design, development,
manufacture,  sale, marketing and distribution of Yanuk's "Yanuk" brand products
to the wholesale and retail trade. We will pay to Yanuk a royalty of six percent
(6%) of all net  sales  of the  products  licensed  under  the  agreement  and a
guaranteed  minimum  royalty on a  quarterly  basis as further  set forth in the
License Agreement.  In addition,  during the term of the License  Agreement,  we
have the option to purchase from Yanuk the property  licensed  under the License
Agreement,  consisting of certain  trademarks and a design  patent,  at the fair
market  value of such  property  on the  date of the  exercise  of the  purchase
option.  Yanuk is  wholly-owned  by Paul Guez,  our  Chairman,  Chief  Executive
Officer and President,  and a majority  shareholder.  The License  Agreement was
approved  by a  majority  of  our  Board  of  Directors  including  all  of  our
independent directors.

         On August 27, 2005, we opened a retail store in Los Angeles and assumed
all the obligations of a 10-year  property lease which was previously  signed by
Blue Concept LLC in April, 2005.

         Effective  September 8, 2005, Antik entered into a Licensing Term Sheet
(the "Term  Sheet")  with  Titan  Industries,  Inc.,  a  California  corporation
("Titan").

         Pursuant to the Term Sheet, Antik agreed to enter into a formal license
agreement  to provide  Titan with an  exclusive  right to use the "Antik  Denim"
trademark  for the sale of men's and women's  footwear in the United  States and
its possessions and  territories,  Canada and Mexico,  and to provide a right of
first  refusal  for similar use of the  trademark  in Europe and South  America.
Compensation  for use of the "Antik Denim"  trademark  will consist of a royalty
calculated as 6% of Titan's net sales.  Titan has agreed to guarantee payment of
royalties  on  identified  minimum net sales  amounts  ranging  from $1.5 to $15
million  over  each of the  next  six  years,  and to  spend at least 2% of such
minimum  net sales  amounts  during  each year on  advertising  its Antik  Denim
trademarked  products.  The royalty amount may be adjusted downward in the event
that Antik's gross sales do not reach $20 million  during any single year of the
term of the formal license agreement.

         The formal license agreement will have a term of forty-two (42) months,
with one five year renewal option, provided,  however, Titan will be entitled to
terminate the agreement  after the first eighteen (18) 


                                       21



months to the extent that sales of its Antik Denim trademarked  products are not
satisfactory  in its  discretion.  Titan is to pay $22,500 upon execution of the
formal license agreement as an advance against royalties due for the first year.
Pursuant to the Term Sheet,  the formal  license  agreement must be entered into
within 30 days of the  execution of the Term Sheet,  and if for any reason it is
not executed,  the Term Sheet will be deemed to be a binding licensing agreement
and all missing  terms will be deemed to be those which are usual and  customary
in the industry.

         On October 6, 2005,  we entered  into a  five-year  License  Agreement,
effective October 5, 2005, with Yanuk. Under the terms of the License Agreement,
we became the exclusive licensor for the design, development, manufacture, sale,
marketing and  distribution  of Yanuk's "U" brand  products to the wholesale and
retail  trade.  We will pay to Yanuk a royalty of five  percent  (5%) of all net
sales of the products  licensed  under the  agreement  and a guaranteed  minimum
royalty on an annual  basis as further  set forth in the License  Agreement.  In
addition,  during  the term of the  License  Agreement,  we have the  option  to
purchase  from  Yanuk  the  property  licensed  under  the  License   Agreement,
consisting of certain trademark applications and a copyright, at the fair market
value of such property on the date of the exercise of the purchase option. Yanuk
is  wholly-owned  by Paul  Guez,  our  Chairman,  Chief  Executive  Officer  and
President,  and a majority shareholder.  The License Agreement was approved by a
majority of our Board of Directors  including all of our independent  directors.
As a result of the  license,  we will  continue  to  implement  our  multi-brand
strategy and will design,  develop,  market and distribute jeans and accessories
at price points different from those of Antik Denim and Yanuk.

BUSINESS OF BLUE HOLDINGS, INC.

     GENERAL OVERVIEW

         We,  directly  and through our  wholly-owned  subsidiary,  Antik Denim,
L.L.C.,  which was  formed in  September  2004,  design,  develop,  manufacture,
market, distribute and sell high end fashion jeans, apparel and accessories.  We
market,  distribute  and sell "Antik Denim" and, as a result of a recent license
agreement  with  Yanuk,  "Yanuk"  brand  products  in  the  United  States,  and
internationally  in  countries  that  include,  but are not limited to,  Canada,
Belgium,  France,  Germany,  Sweden,  Italy,  Mexico and Japan.  We plan to also
design,  develop, market and distribute jeans and accessories under other brands
that we may license or acquire from time to time.

         We market and  distribute  our  products by  participating  in industry
trade shows,  as well as through our show rooms in Los Angeles and New York.  We
maintain  distributor  relationships  in the United  Kingdom,  France,  Germany,
Sweden,  Greece,  Belgium,  Italy,  Mexico and Japan.  With respect to the Antik
Denim brand, except for Mexico and Japan, we currently have no exclusive or long
term distribution  agreements with any party covering any territory,  and do not
depend on any single distributor to distribute our products. With respect to the
Yanuk brand, except for Mexico and Japan, we currently have no exclusive or long
term distribution  agreements with any party covering any territory,  and do not
depend on any single  distributor to distribute our products.  Our  distributors
often,  but not always,  purchase  products  from us at a discount for resale to
their customers in their respective territories.  Our distributors warehouse our
products  at their  expense  and they ship to and  collect  payment  from  their
customers directly.

         Our products  are sold in the United  States to  department  stores and
boutiques  such  as Saks  Fifth  Avenue,  Neiman  Marcus,  Nordstrom,  Barney's,
Bloomingdales,  Bergdorf Goodman,  Atrium,  Fred Segal,  Intermix,  Kitson,  and
Bendel, as well as smaller boutiques throughout the country.


                                       22



         Our  products  are  sold   internationally  to  department  stores  and
boutiques such as Lane Crawford in Hong Kong,  Harrods and Harvey Nichols in the
United Kingdom,  Barneys and Isetan in Japan, Galleries Lafayette in France, and
Holt Renfrew in Canada.

         We  intend to  operate  certain  flagship  stores  domestically  and to
license overseas  operators to open retail stores that focus on high end fashion
denim  generally,  and the Antik Denim and Yanuk brands,  in  particular.  While
there is no existing plan with respect to the roll-out of such stores, the first
retail store was opened on August 27, 2005 on Melrose Avenue in Los Angeles.

         We also intend to license our proprietary owned and licensed trademarks
with  respect to products  that we believe are not in our core line of business.
While there is no existing  plan with  respect to the types of products to which
we intend to license our  proprietary  trademarks,  on September 8, 2005,  Antik
entered into a term sheet license  agreement  with Titan  Industries,  Inc. that
provides  Titan with an exclusive  right to use the "Antik Denim"  trademark for
the sale of men's and women's  footwear in the United States and its possessions
and territories, Canada and Mexico, and a right of first refusal for similar use
of the trademark in Europe and South America.

     EMPLOYEES

         As of July 31,  2005,  we had 79  employees,  not  including  our three
executive  officers,  Paul Guez,  our  Chairman,  Chief  Executive  Officer  and
President,  Elizabeth Guez, our Chief Operating  Officer,  and Patrick Chow, our
Chief Financial Officer and Secretary.  Of those employees, 17 are employed on a
full time basis.  The  remaining 62  employees  are  part-time  and season based
employees.  All of our employees are allocated  under a service  agreement  with
Blue Concept,  LLC, an entity co-owned by Paul and Elizabeth Guez. A description
of  that  service   agreement  is  set  forth  below  in  the  section  entitled
"Description of Property." Mr. Guez leads our product development, marketing and
sales,  and Ms. Guez  oversees all product  production,  including  our contract
manufacturing  activities.  Our  employees  are  not  unionized  and  except  as
described  in  the  paragraph  below,  no  employees  are  subject  to  existing
employment agreements.

         Antik  executed a letter  agreement  dated March 21, 2005 with  Messrs.
Naouri and Caugant, two of its principal designers and former members,  pursuant
to which Antik agreed that, to the extent Antik closed its exchange  transaction
with us, Antik  would,  or would use its best efforts to cause us to, enter into
employment  agreements  with each of Messrs.  Naouri and  Caugant  whereby  such
individuals  would (i) perform  fashion design services for Antik or us, (ii) be
entitled to receive annual salaries of $240,000, plus bonuses based on net sales
arising from "Antik Denim" brand apparel,  and (iii) be entitled to receive such
other  benefits  as Antik or we may elect to offer to our other  employees  from
time to time.  On July 8, 2005,  we entered into an  Employment  Agreement  with
Philippe Naouri based on the foregoing letter agreement entered into with Antik.
This  agreement  was  amended on August 23,  2005.  Pursuant to the terms of Mr.
Naouri's  employment  agreement,  as amended,  Mr. Naouri was engaged by us as a
fashion  director and senior vice  president  in charge of design,  development,
manufacturing,  marketing  and  wholesale  of apparel  and  related  accessories
bearing the "Antik Denim" trademark for a term of 5 years commencing on July 11,
2005 and  terminating on July 10, 2010. Mr. Naouri will receive an annual salary
of $240,000. Mr. Naouri is entitled to participate in our bonus, incentive stock
option, savings and retirement plans as such plans become available. We have not
yet entered into an agreement  with Mr.  Caugant but  anticipate  doing so on or
before the end of the fiscal year ended December 31, 2005.

     OUR PRODUCTS

         Our  principal  products  are high end  fashion  jeans  that we design,
manufacture,  market,  distribute and sell,  including  through our wholly-owned
subsidiary, Antik Denim, L.L.C., under the "Antik Denim"


                                       23



and  "Yanuk"  labels.  These  jeans are sold in the United  States and abroad to
upscale retailers and boutiques.

         We  currently  sell men's and women's  styles and are in the process of
launching  a  children's  line,  Antik Denim and Yanuk brand jeans are made from
high quality fabrics milled in the United States, Japan, Italy and Spain and are
processed with cutting edge  treatments and finishes.  Our concepts and designs,
including Antik Denim's distinct  vintage western flair,  and our  extraordinary
fit,  embellishments,  patent pending pockets,  unique finishes, hand stitching,
embroidery detail and other attention to detail and quality give Antik Denim and
Yanuk brand jeans and apparel a  competitive  advantage  in the high end fashion
jean market.

         Our jeans are available in multiple combinations of washes, fabrics and
finishes,  with as many as 20  different  combinations  of colors,  fabrics  and
finishes on certain  styles.  Indeed,  we  introduce  new  versions of our major
styles each month - in  different  colors,  washes and  finishes.  Although  the
majority of our sales arise from the sale of jean products,  our product line is
balanced by tops,  including  knits and wovens,  and  accessories,  the sales of
which we anticipate will continue to grow.

         With the recent license of the "U" brand from Yanuk, we plan to design,
develop,  market and  distribute  jeans and  accessories  under the "U" brand at
price points different from those of Antik Denim and Yanuk.

     PRODUCT STRATEGY

         Our overall product  strategy is to offer multiple brands of apparel in
the premium and better denim segments. As a result of the License Agreement with
Yanuk  Jeans,  LLC, we currently  market our products  under the Antik Denim and
Yanuk  brands and plan to  continue  to further  expand our brand  portfolio  by
acquisition  and/or license of existing  apparel  companies  and/or  brands,  as
applicable,  in the premium or better segments of the industry,  or the creation
of new brands by our internal  design team.  Our recent license of the "U" brand
from Yanuk  evidences this strategy.  While no other  definitive  arrangement or
plan is currently in place,  we expect our  management  to  periodically  review
potential   acquisition   targets   and/or   license   partners   and  to   make
recommendations  to our Board of  Directors.  Our goal to  employ a  multi-brand
strategy  diversifies  the fashion and other risks  associated  with reliance on
limited  product  lines.  We believe the  increase  in demand for premium  denim
products over the last couple of years and  relatively  high retail price points
for  premium  jeans,  ranging  from  approximately  $200 to  $400,  offers  us a
significant opportunity to increase our revenues and improve our profitability.

         We also intend to license our proprietary owned and licensed trademarks
with  respect to products  that we believe are not in our core line of business.
While there is no existing  plan with  respect to the types of products to which
we intend to license our  proprietary  trademarks,  on September 8, 2005,  Antik
entered into a term sheet license  agreement  with Titan  Industries,  Inc. that
provides  Titan with an exclusive  right to use the "Antik Denim"  trademark for
the sale of men's and women's  footwear in the United States and its possessions
and territories, Canada and Mexico, and a right of first refusal for similar use
of the trademark in Europe and South America.

         Over the last thirty years,  Mr. Guez,  our Chairman,  Chief  Executive
Officer and President, has engaged in the design,  marketing,  manufacturing and
wholesale  distribution  of premium  fashion  and denim  collections,  including
Sasson Jeans and more recently, a growing stable of contemporary brands, such as
U, Taverniti So Jeans, Duarte Jeans,  Elvis,  Memphis Blues and Grail Jeans. Our
principle  designers,  Philippe Naouri and Alex Caugant have previously assisted
world-renowned  casual  apparel  companies such as Chevignon,  Diesel,  GOA, and
Replay in the design and development of successful brands and products.


                                       24



     OPERATING STRATEGY

         Our  operating  strategy is to continue  to build on our  strengths  in
brand development, marketing, distribution, and product sourcing capabilities to
become the leading company in the high fashion denim apparel industry.  Our goal
is  to  leverage  the  expertise  and  relationships  gained  by  our  executive
management and product design teams' prior experience in creating and developing
premium denim apparel  brands,  product  sourcing and  manufacturing  in the US,
Mexico, and Asia, and distributing to high-end retail channels both domestically
and internationally.

         Additionally,  while we have a service  agreement  with Blue Concept in
place,  we have started to build our own team of  professionals  responsible for
coordinating product manufacturing,  material sourcing, and sales and marketing,
all of whom have significant  prior experience and established  relationships in
the denim apparel industry.

     GROWTH STRATEGY

         We plan to continue  to expand our  operations,  revenues,  and profits
through our internal growth and the acquisition  and/or license of complimentary
apparel  brands  or  companies  that  we may  identify  from  time to  time.  We
anticipate  that our  internal  growth  will be driven by (1)  expansion  of our
product  lines  by  introducing  new  styles  and  complimentary   products  and
accessories, (2) expansion of our wholesale distribution,  both domestically and
internationally through high end retailers, and (3) the opening of select retail
flagship  stores  domestically  and the licensing of operators  overseas to open
stores to promote the  identity of our brands.  The first retail store opened on
August 27, 2005 on Melrose  Avenue in Los Angeles.  The first  product  license,
with  respect  to men's and  women's  footwear,  was  executed  to be  effective
September 8, 2005. We anticipate that our growth strategy  through  acquisitions
and/or licenses will involve the acquisition or license of additional  companies
and/or brands, as applicable,  depending upon a company's and/or a brand's sales
revenues, name and brand recognition,  and/or synergies with the Antik Denim and
Yanuk brands, with the ultimate goal of building a portfolio of lifestyle brands
in the premium and better segments of the denim industry.  Our recent license of
the "U" brand from Yanuk  evidences  this  strategy.  While no other  definitive
arrangement  or  plan is  currently  in  place,  we  expect  our  management  to
periodically review potential  acquisition targets and/or licensing partners and
to make recommendations to our Board of Directors.

     SUPPLY STRATEGY

         We purchase  our fabric,  thread and other raw  materials  from various
industry suppliers within the United States and abroad. We do not currently have
any long-term agreements in place for the supply of our fabric,  thread or other
raw  materials.  The  fabric,  thread  and  other raw  materials  used by us are
available  from a large  number of  suppliers  worldwide.  During the six months
ended  June  30,  2005  only  one  supplier  comprised  greater  than 10% of the
Company's purchases. Purchases from this supplier comprised 13.3%.

     MANUFACTURING

         We presently  outsource all of our  manufacturing  to contract  vendors
using  just  in  time  ordering.   We  use  several  contract  vendors  for  our
manufacturing  needs with the bulk of purchases  (approximately  70%)  currently
occurring from domestic (U.S.) factories. We are increasing the use of factories
in Mexico  and the Far East.  We are not  reliant  on any one  manufacturer  and
manufacturing  capacity  is readily  available  to meet our  current and planned
needs.  We maintain  rigorous  quality control systems for both raw and finished
goods.  To maintain low fixed  expenses,  we will continue to outsource the vast
majority of our  production.  We will add additional  contractors as required to
meet our needs.


                                       25



         We  believe  we  can  realize   significant  cost  savings  in  product
manufacturing  because of our strong  relationships with a diverse group of U.S.
and  international  contract  manufacturers  established by our management  team
through  their prior  experience in the apparel  industry.  Also the increase in
production volume as a result of our multi-brand strategy will give us economies
of scale to achieve more cost savings.

     COMPETITION

         The high-end fashion denim industry is very competitive and fragmented.
Our competitors are companies such as Levi Strauss,  Calvin Klein,  Joe's Jeans,
True Religion Apparel, Seven For All Mankind and Citizens of Humanity.

         Our competitive edge lies in our ability to create innovative  concepts
and designs,  to develop products with extraordinary fit, and to expand our high
quality  fabrics and finishes,  treatments  and  embellishments  (including  our
patent pending pockets,  hand stitching and embroidery  detail). We believe that
we offer value  products that can  successfully  compete in the high end fashion
denim industry.

     TRADEMARKS AND OTHER INTELLECTUAL PROPERTY

         Antik is the holder of trademark  applications  for the "Antique Denim"
and  "Antik  Denim"  marks  in the  United  States  and  various  other  foreign
jurisdictions.  Antik  also  owns  several  proprietary  concepts  and  designs,
including  pending  trademark  and patent  applications  on its pocket  designs.
Yanuk,  from whom we hold  exclusive  licenses to exploit  products based on the
"Yanuk"  and "U"  brands,  is the holder of several  United  States and  foreign
trademarks. We anticipate continuing to expand the Antik Denim and Yanuk brands,
and the newly licensed "U" brand, and their proprietary  trademarks and designs,
worldwide. We also anticipate taking, and have already taken, coordinated action
to curb an increase in the domestic and international  counterfeiting of Antik's
stylized  pocket  design and other  intellectual  property,  including,  without
limitation, through litigation if necessary.

     GOVERNMENT REGULATION AND SUPERVISION

         We benefit from certain international treaties and regulations, such as
the North American Free Trade Agreement  (NAFTA),  which allows for the duty and
quota  free entry into the  United  States of  certain  qualifying  merchandise.
International trade agreements and embargoes by entities such as the World Trade
Organization   also  can  affect  our  business,   although   their  impact  has
historically been favorable as it relates to Antik and Yanuk.

         We  have  implemented   various  programs  and  procedures,   including
unannounced  inspections,  to ensure that all of the apparel  manufacturers with
whom we contract fully comply with  employment  and safety laws and  regulations
governing their place of operation.

     RESEARCH AND DEVELOPMENT

         Mr. Guez, along with a team of designers, is responsible for the design
and  development  of  our  product  lines.  There  is  no  formal  research  and
development plan at this time,  however,  since  inception,  we have apportioned
significant resources on our research and development  activities related to our
designs.


                                       26



FACILITIES

     PRINCIPAL EXECUTIVE OFFICES

         Our  principal  executive  offices are located at 5804 E. Slauson Ave.,
Commerce California 90040. Our telephone number is (323) 725-5555.

     DESCRIPTION OF PROPERTY

         Our offices and  warehouse are located in Commerce,  California.  It is
from this  facility  that we conduct  all of our  executive  and  administrative
functions,  and ship products to our  customers.  We also maintain  showrooms in
both Los  Angeles  and New York City.  The cost of  operations  at the  Commerce
facility and the showrooms is shared by several companies and is allocated to us
pursuant  to  our  service   agreement  with  Blue  Concept,   LLC.  We  utilize
approximately  15,000  sq.  ft. of the  Commerce,  California  facility  and pay
approximately  $15,000 per month  pursuant to this  agreement with Blue Concept,
LLC. We believe that the facilities utilized by us are well maintained,  in good
operating condition and adequate to meet our current and foreseeable needs.

         The service  agreement  with Blue  Concept  also  provides  that (i) in
consideration  of a monthly  service fee of $78,500,  Blue  Concept  provides us
services in the following areas: MIS, human resources,  sales, customer service,
EDI  Support,  quality  control,  purchasing,  import/export  services,  graphic
design, laundry and distribution; and (ii) we share with Blue Concept 15% of the
actual telephone, utilities and office supply expenses incurred by Blue Concept,
as evidenced by actual invoices presented to us.

         On August 27, 2005, we opened a retail store in Los Angeles and assumed
all the obligations of a 10-year  property lease which was previously  signed by
Blue Concept LLC in April, 2005.

LEGAL PROCEEDINGS

         Except as described below, we are not involved in any legal proceedings
that require disclosure in this report.

         On August 22, 2005, Antik filed a lawsuit against two companies that we
believe have encroached on its highly identifiable,  stylized pocket design. The
complaint was filed in the United States  District Court in Los Angeles  against
Turn On Products,  Inc., d/b/a Younique Clothing,  and Alloy  Incorporated.  The
unique  design  in  question  is  copyrighted,  and is the  subject  of  pending
trademark and design patent  registration  claims. The complaint alleges,  among
other  matters,  that the companies are violating  federal and state  trademark,
copyright,  unfair trade practices and unfair competition statutes and laws, and
seeks damages and injunctive relief against all parties.


                                       27



                                   MANAGEMENT

EXECUTIVE OFFICERS AND DIRECTORS

         The  following  table sets forth the name,  age and position of each of
our executive officers and directors at October 3, 2005.

     NAME               AGE      POSITION HELD
     ----               ---      -------------

Paul Guez (1)           60       Chairman, Chief Executive Officer and President
Patrick Chow            52       Chief Financial Officer and Secretary
Elizabeth Guez (1)      52       Chief Operating Officer
Kevin R. Keating        65       Director
Marshall Geller         66       Director

----------
(1)      Paul Guez and Elizabeth Guez are married.

         PAUL GUEZ became our Chairman, Chief Executive Officer and President on
April 29, 2005. Mr. Guez is the sole Manager of Antik, and is co-owner and Chief
Executive  Officer of Blue Concept,  LLC and its several  affiliates,  which are
engaged in the design,  marketing,  manufacturing and wholesale  distribution of
premium  fashion  collections  for a  growing  stable  of  contemporary  brands,
including  Yanuk  (which we  exclusively  licensed  in July  2005),  U (which we
exclusively licensed in October 2005),  Taverniti So Jeans, Duarte Jeans, Elvis,
Memphis  Blues and Grail Jeans.  For the nine year period prior to the formation
of Blue Concept in 2002, Mr. Guez co-operated  Azteca Production  International,
Inc., a Los Angeles based  manufacturer  of denim apparel.  Mr. Guez started his
career in the apparel industry in 1976, when he launched Sasson Jeans.

         PATRICK CHOW became our Chief Financial  Officer and Secretary on April
29, 2005. Mr. Chow was Chief Financial Officer and a director of Tarrant Apparel
Group from January 2002 to August 2004 and stayed as a consultant until January,
2005. He joined  Tarrant as Treasurer in November,  1998.  From 1996 to 1998, he
served as  General  Manager of Fortune  Chart  Consultants  Limited in Hong Kong
where he provided financial  consulting services to corporate clients.  Mr. Chow
has a Bachelor of Arts degree from the  University of Hong Kong and two diplomas
in Banking and Financial Studies from the Chartered Institute of Bankers, United
Kingdom.

         ELIZABETH  GUEZ became our Chief  Operating  Officer on April 29, 2005.
Ms. Guez is also the Chief Operating  Officer for Blue Concept,  LLC and several
of its  affiliates.  From 1970 through 1978,  Ms. Guez attended  Monmouth  (West
Longbranch,  NJ) and Fashion  Institute  of  Technology  of New York City.  From
1974-1982,   she  held  various   buying  and  store  line   positions  for  the
Bamberger/Macy  organization.  Ms.  Guez  subsequently  held  various  sales and
merchandising positions with Esprit de Corp, Chaus, and Jag of Beverly Hills.

         KEVIN R.  KEATING has served on our Board of  Directors  since  January
2005 and prior to the  consummation  of our  exchange  transaction  with  Antik,
served as our sole officer and director.  Mr. Keating is an investment executive
and for the past  nine  years has been the  Branch  Manager  of the Vero  Beach,
Florida,  office  of  Brookstreet  Securities  Corporation.   Brookstreet  is  a
full-service,  national  network of independent  investment  professionals.  Mr.
Keating  services the investment  needs of private clients with special emphasis
on equities.  He is currently a director of public  companies  including 99 Cent
Stuff Inc., Catalyst Lighting Group, Inc., Wentworth I, Inc.,  Qorus.com,  Inc.,
Multilink  Telecommunications,  Inc., and Century Pacific Financial Corporation.
For more than 35 years, he has been engaged in various aspects of the investment
brokerage  business.  Mr.  Keating  began his Wall Street  career with the First
Boston Company in New York in 1965. From 1967 through 1974, he was employed


                                       28



by  several  institutional  research  boutiques  where  he  functioned  as  Vice
President  Institutional Equity Sales. From 1974 until 1982, Mr. Keating was the
President and Chief Executive Officer of Douglas Stewart, Inc., a New York Stock
Exchange member firm. Since 1982, he has been associated with a variety of firms
as a registered  representative servicing the needs of individual investors. Mr.
Keating is also the manager and sole member of Vero Management, LLC, which had a
management  agreement  with  Marine  that  was  terminated  effective  as of the
Closing.

         MARSHALL  GELLER became a member of our Board of Directors on August 1,
2005.  Mr.  Geller is a  co-founder  and Senior  Managing  Director of St. Cloud
Capital Partners, L.P., a Los Angeles, California-based mezzanine fund formed in
December  2001.  He is also the  Chairman  and CEO of  Geller  & Friend  Capital
Partners, a Los Angeles based private merchant bank. He has extensive experience
initiating,  arranging and making  investments in public and private  companies.
Mr. Geller spent over twenty years as Senior Managing Director for Bear, Stearns
& Company,  with  oversight of all  operations  in Los Angeles,  San  Francisco,
Chicago,  Hong Kong and the Far  East.  He is  currently  a  director  of public
companies including 1st Century Bank, NA, ValueVision Media, Inc., GP Strategies
Corporation and Viking  Systems,  Inc. Mr. Geller also serves as a member of the
Board  of  Governors  of  Cedars-Sinai  Medical  Center,  Los  Angeles.  He  was
previously the Interim  Co-Chairman of Hexcel  Corporation and Interim President
and COO of Players  International,  Inc. Mr. Geller  graduated  from  California
State University,  Los Angeles, with a BS in Business  Administration,  where he
currently  serves on the Dean's  Advisory  Council for the College of Business &
Economics.

BOARD COMPOSITION AND COMMITTEES

         Our  board of  directors  currently  consists  of three  members.  Each
director was elected either at a meeting of  shareholders  or by written consent
of the shareholders and serves until our next annual meeting or until his or her
successor is duly elected and qualified.

         Our board has an Audit  Committee which is comprised of the Board's two
independent  directors,  Messrs. Keating and Geller. Mr. Keating is the Chairman
of the Audit  Committee.  Our board does not have a  compensation  committee  or
nominating  and  corporate  governance  committee.   The  functions  customarily
delegated to these  committees are performed by our full board of directors.  We
intend to establish  each of these  committees to the extent we expand our board
to include at least three  directors  who are  independent  directors  under the
applicable rules of the SEC and NASDAQ.

DIRECTOR COMPENSATION

         Our two  non-employee  directors  receive  cash  compensation  equal to
$5,000 per year, paid quarterly,  for their services as directors,  and are also
reimbursed for their reasonable  expenses incurred on our behalf or in attending
meetings.  Additionally,  the chairman of the Board's Audit  Committee  receives
cash compensation equal to $2,000 per year, paid quarterly,  for his services as
the Chairman. In August 2005, we granted each of Messrs. Keating and Geller, our
two  non-employee  directors,  an option to purchase 30,000 shares of our common
stock at an exercise price of $8.10 per share.  These options were granted under
our 2005 Stock  Incentive  Plan. At the same time, we granted to Mr.  Keating an
option to purchase an additional 2,000 shares of our common stock at an exercise
price of $8.10 per share in  consideration  for his  service as  Chairman of the
Board's Audit Committee.


                                       29



                             EXECUTIVE COMPENSATION

SUMMARY COMPENSATION TABLE

         The following table sets forth,  as to the Chief Executive  Officer and
as to each of the other four most highly  compensated  executive  officers whose
compensation  exceeded  $100,000  during  the  last  fiscal  year,   information
concerning  all  compensation  paid for services to us in all capacities for our
last completed fiscal year, which commenced on September 13, 2004 (the inception
of Antik Denim,  L.L.C.) and ended  December 31, 2004.  The  compensation  table
excludes  other  compensation  in the form of  perquisites  and  other  personal
benefits that constituted less than 10% of the total annual salary and bonus for
the executive officer during the applicable fiscal year.

                                                                      LONG-TERM
                                                                    COMPENSATION
                                         ANNUAL COMPENSATION           AWARDS
                                    -----------------------------   -----------
                                                                      NUMBER OF
                      FISCAL YEAR                                    SECURITIES
NAME AND                 ENDED                       OTHER ANNUAL   UNDERLYING
PRINCIPAL POSITION    DECEMBER 31,  SALARY   BONUS   COMPENSATION      OPTIONS
                      -----------   ------   -----   ------------   -----------
Paul Guez...........     2004        Nil      Nil        Nil            Nil
 Chief Executive 
 Officer and Manager

----------

         Under the terms of Antik's  Operating  Agreement  dated to be effective
September 13, 2004 (the "Operating Agreement"),  by and among the Antik Members,
including Mr. Guez,  certain of the Antik Members (not  including Mr. Guez) were
entitled to receive, and were receiving since September 13, 2004,  distributions
under the Operating  Agreement.  Since inception through December 31, 2004, such
distributions  totaled $79,190. At the closing of the transactions  contemplated
by the Exchange  Agreement with Antik, the terms and conditions of the Operating
Agreement terminated and those Antik Members previously receiving  distributions
are no longer entitled to such distributions. At the closing, we became the sole
member of Antik and have  established  such terms and conditions with respect to
the operation and governance of Antik as we deem appropriate.

OPTION GRANTS IN 2004

         Antik is a limited liability company formed under the laws of the State
of California. During the period from its inception (September 13, 2004) through
December 31, 2004, it did not maintain any membership interest option or profits
interest plan.  Accordingly,  Antik did not grant options to purchase membership
or profits  interests during the period from its inception  (September 13, 2004)
through December 31, 2004.

2005 STOCK INCENTIVE PLAN

         Our 2005 Stock  Incentive Plan was adopted and became  effective in May
2005.  A total of  2,500,000  shares of common  stock  have  been  reserved  for
issuance upon exercise of awards  granted under the 2005 Stock  Incentive  Plan.
Any shares of common stock subject to an award,  which for any reason expires or
terminates  unexercised,  are again  available for issuance under the 2005 Stock
Incentive Plan.

         Our 2005 Stock  Incentive Plan will  terminate  after 10 years from the
date on which our board  approved the plan,  unless it is terminated  earlier by
our board.  The plan  authorizes  the award of stock options and stock  purchase
grants.


                                       30



         Our 2005  Stock  Incentive  Plan is  administered  by our full board of
directors.  To the extent we expand our board of directors,  we intend to form a
compensation  committee,  all  of the  members  of  which  will  be  independent
directors under  applicable  federal  securities  laws and outside  directors as
defined  under  applicable  federal  tax  laws.  Following  its  formation,  the
compensation  committee  will have the  authority to construe and  interpret the
plan, grant awards and make all other determinations  necessary or advisable for
the administration of the plan.

         Our 2005 Stock  Incentive Plan provides for the grant of both incentive
stock options that qualify  under  Section 422 of the Internal  Revenue Code and
nonqualified  stock  options.  Incentive  stock  options may be granted  only to
employees  of ours or any parent or  subsidiary  of ours.  All awards other than
incentive  stock options may be granted to our employees,  officers,  directors,
consultants,  independent  contractors  and  advisors  of ours or any  parent or
subsidiary  of ours.  The exercise  price of incentive  stock options must be at
least equal to the fair market  value of our common  stock on the date of grant.
The exercise price of incentive stock options granted to 10%  shareholders  must
be at least  equal to 110% of that value.  The  exercise  price of  nonqualified
stock options will be determined by our compensation  committee when the options
are granted.

         In  general,  options  will vest over a four-year  period.  The term of
options granted under our 2005 Stock Incentive Plan may not exceed 10 years.

         Awards  granted  under  our  2005  Stock  Incentive  Plan  may  not  be
transferred  in any  manner  other  than by will or by the laws of  descent  and
distribution or as determined by our  compensation  committee.  Unless otherwise
restricted  by our  compensation  committee,  nonqualified  stock options may be
exercised  during  the  lifetime  of the  optionee  only  by the  optionee,  the
optionee's  guardian or legal  representative or a family member of the optionee
who has acquired the option by a permitted transfer. Incentive stock options may
be exercised  during the  lifetime of the  optionee  only by the optionee or the
optionee's  guardian or legal  representative.  Options  granted  under our 2005
Stock  Incentive  Plan  generally  may be exercised for a period of three months
after  the  termination  of the  optionee's  service  with us or any  parent  or
subsidiary  of  ours.   Options  will  generally   terminate   immediately  upon
termination of employment for cause.

         The purchase price for restricted stock will be determined by our board
of directors or  compensation  committee,  as applicable,  at the time of grant.
Stock  bonuses  may be  issued  for past  services  or may be  awarded  upon the
completion of services or performance goals.

         If we are subject to a change in control  transaction,  all outstanding
awards may be assumed  or  replaced  with a  substitute  grant by the  successor
company,  if any.  If the  outstanding  awards are not  assumed  by a  successor
company, if any, then all remaining  unexercised options shall become vested and
fully exercisable.

EMPLOYMENT CONTRACTS

         Except as  described in this  section,  we and Antik are not parties to
any employment agreements with any of our respective executive officers.

         Antik  executed a letter  agreement  dated March 21, 2005 with  Messrs.
Naouri and Caugant, two of its principal designers and former members,  pursuant
to which Antik agreed that, to the extent Antik closed its exchange  transaction
with us, Antik  would,  or would use its best efforts to cause us to, enter into
employment  agreements  with each of Messrs.  Naouri and  Caugant  whereby  such
individuals  would (i) perform  fashion design services for Antik or us, (ii) be
entitled to receive annual salaries of $240,000, plus bonuses based on net sales
arising from "Antik Denim" brand apparel,  and (iii) be entitled to receive such
other  benefits  as Antik or we may elect to offer to our other  employees  from
time to time. On July 8,


                                       31



2005, we entered into an Employment  Agreement with Philippe Naouri based on the
foregoing letter agreement  entered into with Antik.  This agreement was amended
on August 23, 2005. Pursuant to the terms of Mr. Naouri's employment  agreement,
as amended,  Mr. Naouri was engaged by us as a fashion  director and senior vice
president  in  charge  of  design,  development,  manufacturing,  marketing  and
wholesale of apparel and related accessories bearing the "Antik Denim" trademark
for a term of 5 years  commencing on July 11, 2005 and  terminating  on July 10,
2010.  Mr.  Naouri will  receive an annual  salary of  $240,000.  Mr.  Naouri is
entitled  to  participate  in our bonus,  incentive  stock  option,  savings and
retirement plans as such plans become available. We have not yet entered into an
agreement with Mr.  Caugant but anticipate  doing so on or before the end of the
fiscal year ended December 31, 2005.

INDEMNIFICATION OF DIRECTORS AND EXECUTIVE OFFICERS AND LIMITATION OF LIABILITY

         The Nevada Revised Statutes and certain  provisions of our Bylaws under
certain circumstances provide for indemnification of our officers, directors and
controlling persons against liabilities which they may incur in such capacities.
A summary of the circumstances in which such  indemnification is provided for is
contained herein, but this description is qualified in its entirety by reference
to our bylaws and to the statutory provisions.

         In general, any officer, director, employee or agent may be indemnified
against expenses,  fines,  settlements or judgments arising in connection with a
legal  proceeding to which such person is a party, if that person's actions were
in good faith, were believed to be in our best interest,  and were not unlawful.
Unless  such  person  is   successful   upon  the  merits  in  such  an  action,
indemnification  may be  awarded  only  after  a  determination  by  independent
decision  of the  board  of  directors,  by legal  counsel,  or by a vote of the
shareholders,  that the applicable  standard of conduct was met by the person to
be indemnified.

         The circumstances under which  indemnification is granted in connection
with an action  brought on our behalf is  generally  the same as those set forth
above;  however,  with respect to such actions,  indemnification is granted only
with respect to expenses  actually  incurred in  connection  with the defense or
settlement of the action.  In such actions,  the person to be  indemnified  must
have  acted in good  faith  and in a manner  believed  to have  been in our best
interest, and have not been adjudged liable for negligence or misconduct.

         Indemnification may also be granted pursuant to the terms of agreements
which may be entered  in the future or  pursuant  to a vote of  shareholders  or
directors.  The statutory  provision  cited above also grants the power to us to
purchase  and maintain  insurance  which  protects  our  officers and  directors
against any  liabilities  incurred in  connection  with their  service in such a
position, and such a policy may be obtained by us.

         We have entered into separate but identical Indemnification  agreements
(the  "Indemnification  Agreements")  with each of our  directors  and executive
officers  (the  Indemnitees").  Pursuant  to the  terms  and  conditions  of the
Indemnification  Agreements,  we indemnified each Indemnitee against any amounts
which he or she becomes  legally  obligated to pay in connection  with any claim
against him or her based upon any action or inaction which he or she may commit,
omit or suffer while acting in his or her capacity as a director  and/or officer
of us or our subsidiaries,  provided, however, that the Indemnitee acted in good
faith and in a manner Indemnitee  reasonably believed to be in or not opposed to
our best interests and, with respect to any criminal  action,  had no reasonable
cause to believe Indemnitee's conduct was unlawful.

         A shareholder's  investment may be adversely  affected to the extent we
pay the costs of settlement and damage awards against  directors and officers as
required by these indemnification  provisions.  At present,  there is no pending
litigation or proceeding  involving any of our directors,  officers or employees


                                       32



regarding  which  indemnification  by us is  sought,  nor  are we  aware  of any
threatened litigation that may result in claims for indemnification.

         Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors,  officers or persons  controlling us pursuant
to the foregoing  provisions,  we have been informed that, in the opinion of the
SEC,  this  indemnification  is  against  public  policy  as  expressed  in  the
Securities Act and is therefore unenforceable.


                                       33



                             PRINCIPAL SHAREHOLDERS

         The following  table  presents  information  regarding  the  beneficial
ownership  of our common  stock as of October 3, 2005 and as adjusted to reflect
the sale of the common stock in this offering by:

         o        each  of  the  executive   officers   listed  in  the  summary
                  compensation table;

         o        each of our directors;

         o        all of our directors and executive officers as a group; and

         o        each  shareholder  known by us to be the  beneficial  owner of
                  more than 5% of our common stock.

         Beneficial  ownership is determined in accordance with the rules of the
SEC  and  generally   includes  voting  or  investment  power  with  respect  to
securities.  Unless otherwise indicated below, to our knowledge, the persons and
entities  named in the table  have sole  voting and sole  investment  power with
respect to all shares  beneficially  owned,  subject to community  property laws
where applicable. Shares of our common stock subject to options from the company
that are currently  exercisable or exercisable within 60 days of October 3, 2005
are deemed to be outstanding and to be beneficially  owned by the person holding
the options for the purpose of computing the percentage ownership of that person
but are not treated as  outstanding  for the purpose of computing the percentage
ownership of any other person.

         The information  presented in this table is based on 25,557,200  shares
of our common stock outstanding on October 3, 2005. Unless otherwise  indicated,
the  address of each of the  executive  officers  and  directors  and 5% or more
shareholders  named below is c/o Blue  Holdings,  Inc.,  5804 E.  Slauson  Ave.,
Commerce, California 90040.

                                                    NUMBER OF SHARES
                                                   BENEFICIALLY OWNED
                                         ---------------------------------------
                                                            PERCENTAGE OF SHARES
NAME OF BENEFICIAL OWNER                      NUMBER            OUTSTANDING
------------------------------------     ---------------    --------------------

EXECUTIVE OFFICERS AND DIRECTORS:
Paul Guez (1).......................         18,433,647             72.1%
Patrick Chow (2)....................             30,000               *
Elizabeth Guez (3)..................         18,433,647             72.1%
Kevin R. Keating (4)................             46,483               *
Marshall Geller (5).................             10,000               *
All 3 directors and executive
   officers as a group .............         18,520,130             72.5%

5% SHAREHOLDERS:

Meyer Abbou (6)                               2,004,741              7.8%
Philippe Naouri (7)                           1,739,741              6.8%
Alexandre Caugant (8)                         1,739,741              6.8%

TOTAL:                                       25,306,657             98.9%
*       Less than 1%

(1)      Consists of 16,433,647 shares of common stock  beneficially held by Mr.
         Guez,  and 2,000,000  shares of common stock  beneficially  held by Mr.
         Guez' spouse, Elizabeth Guez.

(2)      Consists of 30,000 shares of common stock.


                                       34



(3)      Consists of 2,000,000 shares of common stock  beneficially  held by Ms.
         Guez, and 16,433,647  shares of common stock  beneficially  held by Ms.
         Guez' spouse, Paul Guez.

(4)      Consists of (i) 34,483 shares of common  stock,  and (ii) 12,000 shares
         of common stock that may be acquired  from us within 60 days of October
         3,  2005 upon the  exercise  of  outstanding  stock  options.  Kevin R.
         Keating,  a director  of the  company,  is the father of the  principal
         member of Keating  Investments,  LLC. Keating  Investments,  LLC is the
         managing  member  of KRM  Fund.  Keating  Investments,  LLC is also the
         managing member and 90% owner of Keating Securities,  LLC, a registered
         broker-dealer.  Kevin  R.  Keating  is not  affiliated  with and has no
         equity  interest  in  Keating  Investments,  LLC,  KRM Fund or  Keating
         Securities,  LLC and disclaims any beneficial interest in the shares of
         our common  stock owned by KRM Fund.  Similarly,  Keating  Investments,
         LLC,  KRM Fund and Keating  Securities,  LLC  disclaim  any  beneficial
         interest in the shares of our common stock  currently owned by Kevin R.
         Keating.

(5)      Consists of 12,000  shares of common stock that may be acquired from us
         within 60 days of October 3, 2005 upon the  exercise of an  outstanding
         stock option.

(6)      Consists of 2,004,741 shares of common stock.

(7)      Consists of 1,739,741 shares of common stock.

(8)      Consists of 1,739,741 shares of common stock.


                                       35



                           RELATED PARTY TRANSACTIONS

         Other than the employment  arrangements  described above in "Employment
Contracts"  and the  transactions  described  below,  since  September  13, 2004
(inception) there has not been, nor is there currently proposed, any transaction
or series of similar transactions to which we were or will be a party:

         o        in which the amount involved exceeds $60,000; AND

         o        in which any director,  executive officer,  other shareholders
                  of more  than 5% of our  common  stock or any  member of their
                  immediate  family  had or  will  have  a  direct  or  indirect
                  material interest.

TRANSACTIONS WITH OFFICERS AND DIRECTORS

PAUL GUEZ / ELIZABETH GUEZ

         On October 6, 2005,  we entered  into a  five-year  License  Agreement,
effective October 5, 2005, with Yanuk. Under the terms of the License Agreement,
we became the exclusive licensor for the design, development, manufacture, sale,
marketing and  distribution  of Yanuk's "U" brand  products to the wholesale and
retail  trade.  We will pay to Yanuk a royalty of five  percent  (5%) of all net
sales of the products  licensed  under the  agreement  and a guaranteed  minimum
royalty on an annual  basis as further  set forth in the License  Agreement.  In
addition,  during  the term of the  License  Agreement,  we have the  option  to
purchase  from  Yanuk  the  property  licensed  under  the  License   Agreement,
consisting of certain trademark applications and a copyright, at the fair market
value of such property on the date of the exercise of the purchase option. Yanuk
is  wholly-owned  by Paul  Guez,  our  Chairman,  Chief  Executive  Officer  and
President,  and a majority shareholder.  The License Agreement was approved by a
majority of our Board of Directors including all of our independent directors.

         On August 27, 2005, we opened a retail store in Los Angeles and assumed
all the obligations of a ten-year  property lease which was entered into by Blue
Concept LLC in April,  2005. Blue Concept LLC is a company co-owned by Paul Guez
and Elizabeth Guez. The lease is guaranteed by Paul Guez and Elizabeth Guez.

         On  July  5,  2005,  we  entered  into a  ten-year  License  Agreement,
effective July 1, 2005, with Yanuk Jeans, LLC ("Yanuk").  Under the terms of the
License Agreement, we became the exclusive licensor for the design, development,
manufacture,  sale,  marketing  and  distribution  of  Yanuk's  products  to the
wholesale and retail  trade.  We will pay to Yanuk a royalty of six percent (6%)
of all net sales of the products  licensed  under the agreement and a guaranteed
minimum  royalty  on a  quarterly  basis as  further  set  forth in the  License
Agreement.  In addition,  during the term of the License Agreement,  we have the
option to purchase from Yanuk the property licensed under the License Agreement,
consisting of certain  trademarks and a design patent,  at the fair market value
of such  property on the date of the exercise of the purchase  option.  Yanuk is
wholly-owned by Paul Guez, our Chairman,  Chief Executive Officer and President,
and a majority shareholder.  The License Agreement was approved by a majority of
our Board of Directors  including  all of our directors  independent  of and not
affiliated with Yanuk.

         During the six months  ending June 30, 2005, we had total sales of $0.7
million to Blue Concept Europe Limited, a company owned by Paul Guez.

         The cost of operations at our Commerce facility and our Los Angeles and
New York  showrooms  is shared  by  several  companies  and is  allocated  to us
pursuant to our service agreement ("service  agreement") with Blue Concept, LLC,
an entity co-owned by Paul Guez and Elizabeth Guez, our Chief


                                       36



Executive Officer and Chief Operating Officer,  respectively,  which is dated to
be  effective  May 18,  2005.  We  utilize  approximately  15,000  sq. ft of the
Commerce,  California facility and pay approximately  $15,000 per month pursuant
to this agreement with Blue Concept.  We believe that the facilities utilized by
us are well  maintained,  in good  operating  condition and adequate to meet our
current and  foreseeable  needs.  The service  agreement  with Blue Concept also
provides that (i) in  consideration  of a monthly  service fee of $78,500,  Blue
Concept  provides us services in the  following  areas:  MIS,  human  resources,
sales, customer service, EDI Support, quality control, purchasing, import/export
services, graphic design, laundry and distribution;  and (ii) we share with Blue
Concept  15% of the  actual  telephone,  utilities  and office  supply  expenses
incurred by Blue Concept,  as evidenced by actual invoices  presented to us. The
service agreement was approved by a majority of our Board of Directors including
all of our directors independent of and not affiliated with Blue Concept. During
the period from inception,  September 13, 2004, to December 31, 2004 and for the
six months ended June 30,  2005,  the Company  reimbursed  $390,185 and $624,295
respectively for these expenses.

         On April 14, 2005, we entered into the Exchange  Agreement  with Antik,
the members of Antik, and KRM Fund. The closing of the transactions contemplated
by the  Exchange  Agreement  occurred  on April 29,  2005.  At the  closing,  we
acquired all of the outstanding  membership interests of Antik (the "Interests")
from the Antik Members, and the Antik Members contributed all of their Interests
to us. In exchange,  we issued to the Antik Members 843,027 shares of our Series
A  Convertible  Preferred  Stock,  par value  $0.001 per share  (the  "Preferred
Shares"),  which,  as a result of the approval by a substantial  majority of our
outstanding  shareholders  entitled  to vote and the  approval  by our  Board of
Directors,  of amendments to our Articles of Incorporation  that (i) changed our
name to Blue Holdings,  Inc., (ii) increased our authorized  number of shares of
common stock to 75,000,000, and (iii) adopted a 1-for-29 reverse stock split, on
June 7,  2005  converted  into  708,984,875  shares  of our  common  stock  on a
pre-reverse  stock split basis and  24,447,783  shares of our common  stock on a
post-reverse stock split basis.

         At the closing, Antik became our wholly-owned  subsidiary.  As a result
of the closing of the transactions  contemplated by the Exchange Agreement,  the
Antik Members  (together with Elizabeth Guez, our Chief Operating  Officer,  and
Patrick  Chow,  our Chief  Financial  Officer) hold  approximately  93.7% of the
outstanding shares of our common stock.

         On  February  28,  2005,  in  accordance  with  the  provisions  of the
Operating Agreement of Antik, Paul Guez contributed piece goods inventory with a
fair market value at cost of $1,200,000 to Antik.

         Antik was a party to an allocation  letter  agreement  dated January 2,
2005 with Blue Concept  pursuant to which, for the year ended December 31, 2005,
the parties agreed to allocate,  and Antik was ultimately liable for,  operating
expenses of Blue Concept allocable to Antik. The allocations were to be on terms
no less favorable  than those that could be reasonably  obtained in arms' length
transactions  with  independent  third  parties  and were to be subject to final
approval by Antik's,  or its successor's,  audit committee,  as applicable.  The
allocation agreement applied to, among other matters,  employees of Blue Concept
providing  services  to or on behalf of Antik,  and  covered  salaries,  payroll
taxes, and various  employment  benefits and benefit plans,  including  medical,
dental  and 401(k)  plans for such  employees.  The  allocation  agreement  also
applied to other expenses consisting of utilities,  common area services,  rent,
insurance and other office services. This allocation agreement was terminated in
consideration for the service agreement described above.

         Antik  was a party  to a  similar  allocation  letter  agreement  dated
December  31,  2004 with Blue  Concept,  for the period from  inception  through
December  31,  2004.  Pursuant to this  letter  agreement,  Antik was  allocated
approximately  $104,049  per  month  of  operating  expenses  allocable  to  its
operations,  or a total of $390,185 for the entire  period.  Antik has confirmed
that such allocations were made on 


                                       37



terms no less  favorable  than those that could be reasonably  obtained in arms'
length transactions with independent third parties.

         During the period from inception  through  December 31, 2004, Paul Guez
and several companies co-owned by Paul Guez,  provided advance loans to Antik in
the form of  inventory  with a fair  market  value at cost,  or cash for working
capital  purposes,  in an amount equal to $246,857.  The advances were unsecured
and  non-interest  bearing,  with no formal terms of  repayment.  As of June 30,
2005, the principal amount outstanding for such advances was equal to $150,995.

         Advances made by Blue Holdings and Antik's factor are collateralized by
non-factored accounts receivable,  inventories, general intangibles and personal
guarantees  executed by Blue Concept and Paul Guez. The guarantees  provide that
the factor may pursue claims  against Blue Concept or Mr. Guez in the event that
Antik defaults on its obligations to the factor.

         In consideration for his initial  membership  interests in Antik, which
were  subsequently  exchanged for shares of the preferred stock of Blue Holdings
in its exchange  transaction with Antik, Mr. Guez contributed cash in the amount
of $500,000 and certain trademark  applications,  and agreed to contribute up to
an additional  $3,200,000  of cash and/or  property as was to be required by him
acting as Manager of Antik.  In February  2005, Mr. Guez  contributed  the piece
goods inventory described above.

PATRICK CHOW

         On September 2, 2005, in  connection  with the  acquisition  by Patrick
Chow,  our Chief  Financial  Officer,  of an aggregate  of 30,000  shares of our
common stock in a private  transaction not related to the Company,  we agreed to
provide Mr. Chow with  registration  rights with  respect to the resale of those
shares.  It is pursuant to that  agreement  that we have agreed to register  for
resale the shares held by Mr. Chow on the  registration  statement of which this
prospectus is a part.  The agreement  restricts Mr. Chow from selling any amount
greater than 10% of his existing  holdings in us during any applicable  calendar
month.

KEVIN R. KEATING / KRM FUND

         On January 11, 2005, Mr. Jeff Jordan entered into a Securities Purchase
Agreement  ("Purchase  Agreement")  with Keating  Reverse Merger Fund, LLC ("KRM
Fund"), under which KRM Fund agreed to purchase,  and Mr. Jordan agreed to sell,
an   aggregate   of   15,306,500    shares   of   our   common   stock   (on   a
pre-reverse-stock-split basis) owned by him for a purchase price of $440,000, or
$0.029 per share.

         On January 20, 2005, we entered into an Assumption  Agreement  with Mr.
Jordan and Intellijet Marine, Inc. ("Intellijet"),  a Nevada corporation that we
established as a wholly-owned  subsidiary.  Under the Assumption  Agreement,  we
transferred all of our assets,  except for 21,822,570  shares of common stock of
Intellijet and approximately $2,500 in cash, to Intellijet. Intellijet agreed to
assume all of our  liabilities  and obligations and to indemnify us for any loss
we incur with respect to the assumed liabilities. Mr. Jordan and Intellijet also
agreed to release us from any and all obligations and claims whatsoever.

         On February 4, 2005, we completed the  distribution  of all  21,822,570
shares of common stock of Intellijet owned by us pro rata to our shareholders of
record  as of  January  24,  2005.  Pursuant  to the  distribution,  each of our
shareholders received one share of common stock of Intellijet for each one share
of our common stock owned of by our shareholders on the record date.  Intellijet
is now an independent  company and will continue to operate our former  business
of developing marine jet propulsion technology;  supplying mechanical components
under the Quick JetTM brand name;  and licensing boat  manufacturers  to produce
boats incorporating Intelllijet's systems.


                                       38



         Mr. Jordan  completed the sale of his shares to KRM Fund on February 9,
2005.

         On February 17, 2005, we entered into a contract with Vero  Management,
LLC ("Vero") for managerial and administrative services. Vero was not engaged to
provide,  and Vero  did not  render,  legal,  accounting,  auditing,  investment
banking or capital  formation  services.  Kevin R. Keating,  a director,  is the
manager of Vero. The term of the contract was for one year. In  consideration of
the services provided, Vero was paid $1,000 for each month in which services are
rendered. The agreement with Vero terminated on the closing date of the exchange
transaction with Antik.

         On February 17, 2005, we issued 34,483 shares of our common stock (on a
post-reverse-stock-split  basis)  to Kevin R.  Keating,  our  sole  officer  and
director at the time, for services rendered to us with a fair value of $10,000.

         On February 17, 2005, we issued  172,414 shares of our common stock (on
a post-reverse-stock-split basis) to KRM Fund for an aggregate purchase price of
$50,000.

         Kevin R.  Keating,  a  director  of the  company,  is the father of the
principal member of Keating Investments,  LLC. Keating  Investments,  LLC is the
managing  member  of KRM Fund and,  prior to the  closing  date of the  exchange
transaction with Antik, was our majority shareholder.  Keating Investments,  LLC
is also  the  managing  member  and 90%  owner of  Keating  Securities,  LLC,  a
registered  broker-dealer.  Kevin R. Keating is not  affiliated  with and has no
equity interest in Keating Investments, LLC, KRM Fund or Keating Securities, LLC
and disclaims any beneficial interest in the shares of our common stock owned by
KRM Fund. Similarly, Keating Investments,  LLC, KRM Fund and Keating Securities,
LLC disclaim any beneficial interest in the shares of our common stock currently
owned by Kevin R. Keating.

         At the closing date of the exchange  transaction with Antik, we entered
into a certain financial advisory agreement with Keating  Securities,  LLC under
which Keating  Securities,  LLC was compensated by us for its advisory  services
rendered to us in connection with the closing of the exchange  transaction.  The
transaction  advisory  fee was  $350,000,  with the payment  thereof made at the
closing.

TRANSACTIONS WITH THE FORMER MEMBERS OF ANTIK DENIM, L.L.C.

         Antik  executed a letter  agreement  dated March 21, 2005 with  Messrs.
Naouri and Caugant, two of its principal designers and former members,  pursuant
to which Antik agreed that, to the extent Antik closed its exchange  transaction
with us, Antik  would,  or would use its best efforts to cause us to, enter into
employment  agreements  with each of Messrs.  Naouri and  Caugant  whereby  such
individuals  would (i) perform  fashion design services for Antik or us, (ii) be
entitled to receive annual salaries of $240,000, plus bonuses based on net sales
arising from "Antik Denim" brand apparel,  and (iii) be entitled to receive such
other  benefits  as Antik or we may elect to offer to our other  employees  from
time to time.

         On July 8, 2005, we entered into an Employment  Agreement with Philippe
Naouri based on the foregoing  letter  agreement  entered into with Antik.  This
agreement was amended on August 23, 2005.  Pursuant to the terms of Mr. Naouri's
employment  agreement,  as  amended,  Mr.  Naouri was engaged by us as a fashion
director  and  senior  vice   president   in  charge  of  design,   development,
manufacturing,  marketing  and  wholesale  of apparel  and  related  accessories
bearing the "Antik Denim" trademark for a term of 5 years commencing on July 11,
2005 and  terminating on July 10, 2010. Mr. Naouri will receive an annual salary
of $240,000. Mr. Naouri is entitled to participate in our bonus, incentive stock
option, savings and retirement plans as such plans become available. We have not
yet entered into an agreement  with Mr.  Caugant but  anticipate  doing so on or
before the end of the fiscal year ended December 31, 2005.


                                       39



         Pursuant to the provisions of the Exchange  Agreement  among us, Antik,
and the members of Antik,  the members of Antik agreed  that,  in the event that
our stockholders'  equity (on a consolidated  basis following the closing of the
transactions contemplated by that agreement) as reported in our Quarterly Report
on Form 10-QSB for the quarter ended June 30, 2005 (the  "Consolidated  Equity")
was less than $5,000,000, the members would contribute, within fifteen (15) days
following the filing of such periodic report,  equity capital to us in an amount
equal to the difference  between $5,000,000 and the actual  Consolidated  Equity
reported in such periodic report ("Required Contribution").  In the case of such
Required  Contribution,  each of the Antik  members  agreed  that no  additional
shares  of the our  capital  stock  would be  issued  in  consideration  of such
Required  Contribution,  and  therefore,  the existing  shareholders,  including
Antik's members, would not be further diluted.

         On June 27, 2005, we, Antik,  Antik's former members (i.e., the members
of Antik prior to the closing of the  transactions  contemplated by the Exchange
Agreement),  and KRM Fund, a beneficiary  of certain  provisions of the Exchange
Agreement,   amended  the  Exchange  Agreement  to  require  that  the  Required
Contribution  is to be made,  if at all,  in  connection  with the  Registrant's
Quarterly Report on Form 10-QSB for the quarter ended September 30, 2005.

         Under the terms of Antik's  Operating  Agreement  dated to be effective
September 13, 2004 (the "Operating Agreement"),  by and among the Antik Members,
Messrs.  Naouri,  Caugant and Abbou were entitled to receive, and were receiving
since September 13, 2004,  distributions  under the Operating  Agreement.  Since
inception through December 31, 2004, such distributions  totaled $79,190. At the
closing of the transactions  contemplated by the Exchange  Agreement with Antik,
the terms and conditions of the Operating  Agreement  terminated and those Antik
Members  previously  receiving  distributions  are no  longer  entitled  to such
distributions.

         In consideration for their initial membership interests in Antik, which
were  subsequently  exchanged for shares of the preferred stock of Blue Holdings
in its exchange transaction with Antik,  Messrs.  Naouri and Caugant contributed
certain  property  consisting of trademark and patent  applications,  as well as
proprietary design concepts and artwork,  and Mr. Abbou contributed  $250,000 in
cash.

                          DESCRIPTION OF CAPITAL STOCK

         As of October 3, 2005, our authorized capital stock consisted of:

         o        75,000,000 shares of common stock, par value $0.001 per share;
                  and

         o        5,000,000  shares of  preferred  stock,  par value  $0.001 per
                  share, none of which were designated.

         At October 3, 2005, there were outstanding:

         o        25,557,200  shares of common  stock held by  approximately  67
                  shareholders of record; and

         o        62,000  shares of  common  stock  issuable  upon  exercise  of
                  outstanding options.

COMMON STOCK

     DIVIDEND RIGHTS

         Subject  to  preferences  that may apply to shares of  preferred  stock
outstanding at the time,  the holders of outstanding  shares of our common stock
are entitled to receive  dividends out of funds  legally  available at the times
and in the amounts that our board may determine.


                                       40



     VOTING RIGHTS

         Each  holder of common  stock is entitled to one vote for each share of
common stock held on all matters submitted to a vote of shareholders. Cumulative
voting for the  election of  directors  is not  provided  for in our articles of
incorporation,  which means that the holders of a majority of the voting  shares
voted can elect all of the directors then standing for election.

     NO PREEMPTIVE OR SIMILAR RIGHTS

         Holders  of our common  stock do not have  preemptive  rights,  and our
common stock is not convertible or redeemable.

     RIGHT TO RECEIVE LIQUIDATION DISTRIBUTIONS

         Upon our  dissolution,  liquidation or  winding-up,  the assets legally
available for distribution to our shareholders are  distributable  ratably among
the holders of our common stock,  subject to the preferential rights and payment
of liquidation  preferences,  if any, on any  outstanding  shares of convertible
preferred stock.

     AUTHORIZED BUT UNDESIGNATED PREFERRED STOCK

         We are authorized,  subject to limitations prescribed by Nevada law, to
issue preferred stock in one or more series,  to establish from time to time the
number of shares to be included in each series, to fix the designation,  powers,
preferences   and  rights  of  the  shares  of  each   series  and  any  of  its
qualifications,  limitations  or  restrictions.  Our board can also  increase or
decrease the number of shares of any series,  but not below the number of shares
of that series then  outstanding,  by the  affirmative  vote of the holders of a
majority  of our  capital  stock  entitled  to vote,  unless a vote of any other
holders is required by the articles of  incorporation  establishing  the series.
Our  board  may  authorize  the  issuance  of  preferred  stock  with  voting or
conversion  rights that could adversely  affect the voting power or other rights
of the holders of the common  stock.  The  issuance of  preferred  stock,  while
providing  flexibility  in  connection  with  possible  acquisitions  and  other
corporate  purposes,  could,  among other  things,  have the effect of delaying,
deferring or  preventing a change in control of Blue  Holdings and may adversely
affect the market  price of our common  stock and the voting and other rights of
the  holders of common  stock.  We have no  current  plan to issue any shares of
preferred stock.

ANTI-TAKEOVER PROVISIONS

         Certain  provisions of our articles of incorporation and Nevada law may
have the effect of  delaying,  deferring  or  discouraging  another  person from
acquiring control of Blue Holdings.

     CHARTER AND BYLAW PROVISIONS

         Our  articles of  incorporation,  as amended,  allow our Board to issue
5,000,000  shares of Preferred Stock, in one or more series and with such rights
and preferences  including voting rights,  without further shareholder approval.
In the event that the Board designates additional series of preferred stock with
rights and preferences,  including super-majority voting rights, and issues such
preferred  stock,  the preferred  stock could make our acquisition by means of a
tender offer, a proxy contest or otherwise,  more difficult, and could also make
the removal of incumbent  officers and directors  more  difficult.  As a result,
these  provisions  may  have  an  anti-takeover   effect.  The  preferred  stock
authorized in our articles of incorporation,  as amended, may inhibit changes of
control that are not  approved by our Board.  These  provisions  could limit the
price that future investors might be willing to pay in the future for our common
stock. This could have the effect of delaying,  deferring or preventing a change
in control of the Company.


                                       41



The  issuance  of  preferred  stock could also  effectively  limit or dilute the
voting power of our shareholders.  According, such provisions of our articles of
incorporation,   as  amended,  may  discourage  or  prevent  an  acquisition  or
disposition of our business that could  otherwise be in the best interest of our
shareholders.

         NEVADA LAW

         In  addition,  Nevada has enacted the  following  legislation  that may
deter or frustrate takeovers of Nevada corporations, such as our company:

         AUTHORIZED BUT UNISSUED  STOCK.  The authorized but unissued  shares of
our common stock are available for future issuance without shareholder approval.
These  additional  shares  may be used  for a  variety  of  corporate  purposes,
including  future  public  offering  to  raise  additional  capital,   corporate
acquisitions  and  employee  benefit  plans.  The  existence of  authorized  but
unissued shares of common stock may enable our Board to issue shares of stock to
persons friendly to existing management.

         EVALUATION  OF  ACQUISITION  PROPOSALS.  The  Nevada  Revised  Statutes
expressly  permit our Board,  when  evaluating  any proposed  tender or exchange
offer, any merger,  consolidation or sale of substantially  all of the assets of
Blue  Holdings,  or any  similar  extraordinary  transaction,  to  consider  all
relevant factors including,  without limitation, the social, legal, and economic
effects on the employees, customers, suppliers, and other constituencies of Blue
Holdings and our subsidiaries,  and on the communities and geographical areas in
which they  operate.  Our Board may also  consider  the amount of  consideration
being offered in relation to the then current  market price for our  outstanding
shares  of  capital  stock  and our then  current  value in a freely  negotiated
transaction.  Our Board  believes  such  provisions  are in the  long-term  best
interests of Blue Holdings and our shareholders.

         CONTROL SHARE ACQUISITIONS.  We are subject to the Nevada control share
acquisitions  statute. This statute is designed to afford shareholders of public
corporations in Nevada protection against acquisitions in which a person, entity
or group seeks to gain voting control. With enumerated  exceptions,  the statute
provides that shares  acquired  within certain  specific ranges will not possess
voting rights in the election of directors unless the voting rights are approved
by a  majority  vote of the  public  corporation's  disinterested  shareholders.
Disinterested  shares are shares other than those owned by the acquiring  person
or by a member of a group with respect to a control share acquisition, or by any
officer of the  corporation  or any  employee of the  corporation  who is also a
director.  The  specific  acquisition  ranges  that  trigger  the  statute  are:
acquisitions of shares  possessing  one-fifth or more but less than one-third of
all voting power;  acquisitions of shares possessing  one-third or more but less
than a majority of all voting  power;  or  acquisitions  of shares  possessing a
majority or more of all voting power. Under certain  circumstances,  the statute
permits  the  acquiring  person to call a special  shareholders  meeting for the
purpose of  considering  the grant of voting rights to the holder of the control
shares.  The statute also enables a corporation to provide for the redemption of
control shares with no voting rights under certain circumstances.

TRANSFER AGENT AND REGISTRAR

         The transfer  agent and registrar for our common stock is Pacific Stock
Transfer Company.

LISTING

         Our common stock is quoted on the Over-The-Counter Bulletin Board under
the trading  symbol  "BLHL."  Prior to our name change,  increase in  authorized
shares,  and 1-for-29  reverse stock split,  all which took effect as of June 7,
2005, our common stock was quoted on the  Over-The-Counter  Bulletin Board under
the trading symbol "MJET."


                                       42



                              PLAN OF DISTRIBUTION

         We may sell the common stock registered hereby:

         o        through one or more underwriters or dealers,

         o        directly to purchasers, whether or not through agents, or

         o        through a combination of any of these methods of sale.

         We may distribute and sell the common stock from time to time in one or
more transactions at a fixed price or prices,  which may be changed from time to
time depending on the respective transaction.

         We will  describe  the  method of  distribution  and sale of the common
stock in the applicable prospectus supplement.

         Underwriters, dealers or agents may receive compensation in the form of
discounts, concessions or commissions from us or our purchasers (as their agents
in  connection  with the sale of  securities).  These  underwriters,  dealers or
agents may be considered to be underwriters under the Securities Act of 1933. As
a  result,  discounts,  commissions,  or  profits  on  resale  received  by  the
underwriters,  dealers or agents may be treated as  underwriting  discounts  and
commissions.  Each  prospectus  supplement  will identify any such  underwriter,
dealer or agent,  and  describe any  compensation  received by them from us. Any
initial  public  offering  price and any  discounts  or  concessions  allowed or
reallowed or paid to dealers may be changed from time to time.

         Underwriters,  dealers  and agents may be  entitled,  under  agreements
entered  into  with  us,  to   indemnification   by  us  against  certain  civil
liabilities,  including  liabilities  under the  Securities  Act of 1933,  or to
contribution  with  respect to  payments  made by the  underwriters,  dealers or
agents, under agreements between us and the underwriters, dealers and agents.

         We may  grant  underwriters  who  participate  in the  distribution  of
securities an option to purchase additional securities to cover over-allotments,
if any, in connection  with the  distribution.  Underwriters or agents and their
associates may be customers of, engage in transactions with, or perform services
for us in the ordinary course of business.

         In  connection   with  the  offering  of  the  common  stock,   certain
underwriters  and selling group  members and their  respective  affiliates,  may
engage in transactions  that stabilize,  maintain or otherwise affect the market
price of the applicable securities. These transactions may include stabilization
transactions effected in accordance with Rule 104 of Regulation M promulgated by
the SEC pursuant to which these persons may bid for or purchase  securities  for
the purpose of stabilizing their market price.

         The  underwriters in an offering of securities may also create a "short
position"  for their account by selling more  securities in connection  with the
offering  than  they are  committed  to  purchase  from us.  In that  case,  the
underwriters  could  cover all or a  portion  of the  short  position  by either
purchasing securities in the open market following completion of the offering of
these securities or by exercising any  over-allotment  option granted to them by
us. In  addition,  any  managing  underwriter  may impose  "penalty  bids" under
contractual  arrangements  with other  underwriters,  which  means that they can
reclaim from an underwriter  (or any selling group member  participating  in the
offering) for the account of the other underwriters,  the selling concession for
the securities that are distributed in the offering but  subsequently  purchased
for the account of the underwriters in the open market.  Any of the transactions
described in this paragraph or comparable transactions that are described in any
accompanying prospectus supplement may result in the maintenance of the price of
the securities at a level above that which might otherwise


                                       43



prevail in the open market. None of the transactions described in this paragraph
or in an  accompanying  prospectus  supplement  are  required to be taken by any
underwriters and, if they are undertaken, may be discontinued at any time.

         Our common stock is listed on the Over-the-Counter Bulletin Board under
the symbol  "BLHL." Any shares of common  stock sold  pursuant  to a  prospectus
supplement will be listed on the Over-the-Counter  Bulletin Board, or such other
market or exchange on which our common stock is trading at the time of issuance,
subject to official notice of issuance.

                                  LEGAL MATTERS

         Stubbs Alderton & Markiles, LLP, Encino, California, will pass upon the
validity of the common  stock  offered in this  prospectus,  and any  applicable
prospectus supplement.

                                     EXPERTS

         The consolidated  financial statements of Blue Holdings Inc., (formerly
known as Marine Jet Technology Corp.) and Antik Denim, L.L.C. as of December 31,
2004, and for the period from September 13, 2004  (inception)  through  December
31, 2004,  included in this  prospectus have been so included in reliance on the
report of Weinberg & Company, P.A., independent registered accountants, given on
the authority of said firm as experts in auditing and accounting.

                       WHERE YOU CAN FIND MORE INFORMATION

         We file annual,  quarterly and current  reports,  proxy  statements and
other  information  with the SEC.  We have  also  filed  with the SEC  under the
Securities Act a registration  statement on Form SB-2 with respect to the common
stock offered by this prospectus. This prospectus, which constitutes part of the
registration  statement,  does not contain all the  information set forth in the
registration  statement  or the  exhibits  and  schedules  which are part of the
registration statement,  portions of which are omitted as permitted by the rules
and regulations of the SEC.  Statements  made in this  prospectus  regarding the
contents of any contract or other  document are summaries of the material  terms
of the contract or document.  With respect to each contract or document filed as
an exhibit to the registration statement, reference is made to the corresponding
exhibit.  For further information  pertaining to us and the common stock offered
by this prospectus,  reference is made to the registration statement,  including
the exhibits and  schedules  thereto,  copies of which may be inspected  without
charge at the public reference  facilities of the SEC at 450 Fifth Street, N.W.,
Washington,  D.C.  20549.  Copies  of  all or any  portion  of the  registration
statement may be obtained from the SEC at prescribed  rates.  Information on the
public   reference   facilities   may  be   obtained   by  calling  the  SEC  at
1-800-SEC-0330. In addition, the SEC maintains a web site that contains reports,
proxy and information statements and other information that is filed through the
SEC's EDGAR System. The web site can be accessed at HTTP://WWW.SEC.GOV.


                                       44



                          INDEX TO FINANCIAL STATEMENTS

                                                                            PAGE
                                                                            ----

FINANCIAL STATEMENTS OF BLUE  HOLDINGS, INC. (FORMERLY KNOWN AS 
MARINE JET TECHNOLOGY CORP.), CONSOLIDATED (UNAUDITED) AND 
ANTIK DENIM, L.L.C., (AUDITED)

   Report of Independent Registered Public Accounting Firm............       F-2

   Balance Sheets at June 30, 2005, consolidated (Unaudited)
   and December 31, 2004..............................................       F-3

   Statements of Operations for the Six Months Ended June 30, 2005, 
   consolidated (Unaudited) and for the period September 13, 2004 
   (Inception) to December 31, 2004...................................       F-4

   Statement of Stockholders' And Members' Equity For the Period 
   September 13, 2004 (Inception) to December 31, 2004 and for the 
   six months ended June 30,2005, consolidated (Unaudited)............       F-5

   Statements  of Cash Flows for Six Months Ended June 30, 2005,  
   consolidated (Unaudited) and for the period September 13, 2004 
   (Inception) to December 31, 2004...................................       F-6

   Notes to Financial Statements as of December 31, 2004 and June 30, 
   2005 (Unaudited)...................................................       F-7


                                      F-1



             REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM



To the Board of Directors:
Blue Holdings, Inc., (formerly known as Marine Jet Technology Corp.), 
and Antik Denim, L.L.C.

      We have audited the  accompanying  balance sheet of Blue  Holdings,  Inc.,
(formerly known as Marine Jet Technology Corp.),  and Antik Denim,  L.L.C. as of
December 31, 2004 and the related statements of operations,  members' equity and
cash flows for the period  September 13, 2004  (Inception) to December 31, 2004.
These financial  statements are the responsibility of the Company's  management.
Our responsibility is to express an opinion on these financial  statements based
on our audit.

      We  conducted  our audit in  accordance  with the  standards of the Public
Company Accounting Oversight Board (United States). Those standards require that
we plan and perform the audit to obtain  reasonable  assurance about whether the
financial  statements  are free of  material  misstatement.  An  audit  includes
examining,  on a test basis,  evidence supporting the amounts and disclosures in
the  financial  statements.  An audit also  includes  assessing  the  accounting
principles  used  and  significant  estimates  made  by  management,  as well as
evaluating the overall  financial  statement  presentation.  We believe that our
audit provides a reasonable basis for our opinion.

      In our opinion, the financial statements referred to above present fairly,
in all  material  respects,  the  financial  position  of Blue  Holdings,  Inc.,
(formerly known as Marine Jet Technology Corp.),  and Antik Denim,  L.L.C. as of
December 31, 2004 and the results of its  operations  and its cash flows for the
period  September 13, 2004  (Inception) to December 31, 2004 in conformity  with
accounting principles generally accepted in the United States of America.

WEINBERG & COMPANY, P.A.
Boca Raton, Florida
April 30, 2005


                                      F-2



       BLUE HOLDINGS INC. (FORMERLY KNOWN AS MARINE JET TECHNOLOGY CORP.)
                             AND ANTIK DENIM, L.L.C.
                                 BALANCE SHEETS

                                                            BLUE        ANTIK
                                                          HOLDINGS      DENIM,
                                                            INC.        L.L.C.
                                                          JUNE 30,  DECEMBER 31,
                                                            2005         2004
                                                         ----------   ----------
                                                         (Unaudited)

ASSETS

Current Assets:
   Cash ..............................................   $   31,539   $   73,823
   Due from Factor, net of reserves of
     $293,949 and $59,412, respectively ..............      448,621      378,594
   Accounts Receivable, net of reserves of
     $200,000 and $-0-, respectively .................       36,713      125,673
   Inventories .......................................    5,430,657      812,188
   Due From Related Parties ..........................      180,345        1,583
   Prepaid Expenses and Other Current Assets .........      294,445       14,624
                                                         ----------   ----------
      Total Current Assets ...........................    6,422,320    1,406,485

  Deferred Income Taxes ..............................      197,580         --

  Property and Equipment .............................        9,427       10,483
                                                         ----------   ----------

                                                         $6,629,327   $1,416,968
                                                         ==========   ==========

LIABILITIES AND STOCKHOLDERS' AND MEMBERS' EQUITY

Current Liabilities:
   Accounts Payable ..................................   $2,288,180   $  995,220
   Due to Related Parties ............................      150,995      210,657
   Due to Shareholder ................................         --         36,200
   Due to Customers ..................................         --         90,000
   Income Taxes Payable ..............................      333,064         --
   Accrued Expenses and Other Current Liabilities ....       95,653       45,836
                                                         ----------   ----------
      Total Current Liabilities ......................    2,867,892    1,377,913
                                                         ----------   ----------


Stockholders' and Members' Equity:
   Members' Equity ...................................         --         39,055
   Common Stock $0.001 par value
      Authorized 75,000,000 shares
      Issued and outstanding 25,441,628 ..............       25,442         --
                                                         ----------   ----------
   Common Stock to be Issued, 102,079 shares .........      177,617         --

   Additional Paid-in Capital ........................    3,031,568         --

   Retained Earnings .................................      526,808         --
                                                         ----------   ----------
   Total  Stockholders' and Members' Equity ..........    3,761,435       39,055
                                                         ----------   ----------
                                                         $6,629,327   $1,416,968
                                                         ==========   ==========

See Notes to Financial Statements.


                                      F-3



       BLUE HOLDINGS INC. (FORMERLY KNOWN AS MARINE JET TECHNOLOGY CORP.)
                             AND ANTIK DENIM, L.L.C.
                            STATEMENTS OF OPERATIONS
                  FOR THE PERIOD SEPTEMBER 13, 2004 (INCEPTION)
                   TO DECEMBER 31, 2004 AND FOR THE SIX MONTHS
                         ENDED JUNE 30, 2005 (UNAUDITED)

                                                    BLUE HOLDINGS   ANTIK DENIM,
                                                         INC.          L.L.C.

                                                                   SEPTEMBER 13,
                                                                      2004
                                                     SIX MONTHS    (INCEPTION)
                                                        ENDED           TO
                                                       JUNE 30,     DECEMBER 31,
                                                         2005          2004
                                                    ------------   ------------
                                                     (Unaudited)


Net Sales .......................................   $  8,854,228   $    365,290

Cost of Goods Sold ..............................      4,389,431        157,545
                                                    ------------   ------------

Gross Profit ....................................      4,464,797        207,745

Selling, distribution & administrative expenses .      2,192,334        838,700


Non-Cash Development Costs ......................           --          500,000
                                                    ------------   ------------

Income (Loss) before expenses relating to the
  exchange transaction and provision for income
  taxes .........................................      2,272,463     (1,130,955)


Expenses relating to the exchange transaction ...        477,617           --
                                                    ------------   ------------

Income (loss) before provision for income taxes .      1,794,846     (1,130,955)

Provision for income taxes ......................        136,284            800
                                                    ------------   ------------

Net Income (Loss) ...............................   $  1,658,562   $ (1,131,755)
                                                    ============   ============

Earnings (loss) per share, Basic and Diluted ....   $       0.07   $      (0.05)
                                                    ============   ============

Weighted Average number of common shares
  outstanding, basic and diluted ................     25,441,628     24,447,783
                                                    ============   ============

See Notes to Financial Statements.


                                      F-4




       BLUE HOLDINGS INC. (FORMERLY KNOWN AS MARINE JET TECHNOLOGY CORP.)
                             AND ANTIK DENIM, L.L.C.
                  STATEMENT OF STOCKHOLDER' AND MEMBERS' EQUITY
                        FOR THE PERIOD SEPTEMBER 13, 2004
                      (INCEPTION) TO DECEMBER 31, 2004 AND
                     FOR THE SIX MONTHS ENDED JUNE 30, 2005
                                   (UNAUDITED)


                                               SHARES ISSUED                      COMMON STOCK ISSUABLE
                                          ------------------------               ------------------------
                              MEMBERS                   PAR VALUE     PAID IN                               RETAINED
                              EQUITY         NUMBER       0.001       CAPITAL      NUMBER       AMOUNT      EARNINGS      TOTAL
                            -----------   -----------  -----------  -----------  -----------  -----------  -----------  -----------
                                                                                                        
Members contributions ....  $ 1,250,000          --    $      --    $      --           --    $      --    $      --    $ 1,250,000

Members withdrawals ......      (79,189)         --           --           --           --           --           --        (79,189)

Net loss for the period ..   (1,131,755)         --           --           --           --           --           --     (1,131,755)

Balance, December 31, 2004       39,056          --           --           --           --           --           --         39,056

Contributions ............    1,886,200          --           --           --           --           --           --      1,886,200

Issuance of shares upon
reverse merger ...........         --      24,447,783       24,448      (24,448)        --           --           --           --

Old Marine Jet shares ....         --         993,845          994         (994)        --           --           --           --

Change in status from LLC
to Corp upon completion of
the exchange transaction .   (1,925,256)         --           --      3,057,010         --           --     (1,131,754         --

Shares to be issued to
Finder ...................         --            --           --           --        102,079      177,617         --        177,617


Net Income for the period          --            --           --           --           --           --      1,658,562    1,658,562
                            -----------   -----------  -----------  -----------  -----------  -----------  -----------  -----------

Ending Balance
June 30, 2005 ............  $      --      25,441,628  $    25,442  $ 3,031,568      102,079  $   177,617  $   526,808  $ 3,761,435
                            ===========   ===========  ===========  ===========  ===========  ===========  ===========  ===========


See Notes to Financial Statements.


                                      F-5



       BLUE HOLDINGS INC. (FORMERLY KNOWN AS MARINE JET TECHNOLOGY CORP.)
                             AND ANTIK DENIM, L.L.C.
                            STATEMENTS OF CASH FLOWS
                FOR THE PERIOD SEPTEMBER 13, 2004 (INCEPTION) TO
                 DECEMBER 31, 2004 AND FOR THE SIX MONTHS ENDED
                            JUNE 30, 2005 (UNAUDITED)


                                                    BLUE HOLDINGS   ANTIK DENIM,
                                                         INC.          L.L.C.

                                                                   SEPTEMBER 13,
                                                                      2004
                                                      SIX MONTHS    (INCEPTION)
                                                         ENDED          TO
                                                       JUNE 30,     DECEMBER 31,
                                                         2005          2004
                                                      -----------   -----------
                                                      (Unaudited)

CASH FLOWS FROM OPERATING ACTIVITIES
Net Income (Loss) ..................................  $ 1,658,562   $(1,131,755)
Adjustments to reconcile income (loss) to net
cash used in operating activities
     Non-cash development costs ....................         --         500,000
     Depreciation ..................................        1,056           389
     Stock based exchange transaction expense ......      177,617          --
     Changes in assets and liabilities
     Accounts Receivable ...........................       88,960      (125,673)
     Other Receivable ..............................     (235,883)         --
     Inventories ...................................   (3,418,469)     (812,188)
     Due from Related Parties ......................     (178,762)       (1,583)
     Due to Related Parties ........................      (95,861)      246,857
     Deferred Income Taxes .........................     (197,580)         --
     Prepaid Expenses and other current assets .....      (43,938)      (14,624)
     Income tax payable ............................      333,064          --
     Accounts Payable ..............................    1,292,960       995,220
     Due to Customers ..............................      (90,000)       90,000
     Other current liabilities .....................       49,817        45,836
                                                      -----------   -----------

     Net cash used in operating activities .........     (658,457)     (207,521)
                                                      -----------   -----------

CASH FLOWS FROM INVESTING ACTIVITIES
     Acquisition of property and equipment .........         --         (10,872)
                                                      -----------   -----------

     Net cash used in investing activities .........         --         (10,872)
                                                      -----------   -----------


CASH FLOWS FROM FINANCING ACTIVITIES
     Capital contributions .........................      686,200       750,000
     Distributions to Members ......................         --         (79,190)
     Change in Due from Factor .....................      (70,027)     (378,594)
                                                      -----------   -----------

     Net cash provided by financing activities .....      616,173       292,216
                                                      -----------   -----------

NET INCREASE (DECREASE) IN CASH AT THE END OF PERIOD      (42,284)       73,823
CASH, BEGINNING OF PERIOD ..........................       73,823          --
                                                      -----------   -----------
CASH, END OF PERIOD ................................  $    31,539   $    73,823
                                                      ===========   ===========


SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION

Cash paid for income taxes .........................  $       800   $       800
                                                      ===========   ===========


Non-cash Transactions:
  During the period ended June 30, 2005, a member  contributed  inventory valued
  at its historical  cost of $1,200,000.  During the period ended June 30, 2005,
  the Company  recorded  102,079  shares of common stock to be issued  valued at
  $177,617 in settlement of an expense related to the exchange transaction.

See Notes to Financial Statements.


                                      F-6



                               BLUE HOLDINGS, INC.
                 (FORMERLY KNOWN AS MARINE JET TECHNOLOGY CORP.)
                             AND ANTIK DENIM, L.L.C.

              NOTES TO FINANCIAL STATEMENTS AS OF DECEMBER 31, 2004
                          AND JUNE 30, 2005 (UNAUDITED)

NOTE 1 - BASIS OF PRESENTATION, ORGANIZATION AND NATURE OF OPERATIONS

(a)      ORGANIZATION

         Blue Holdings,  Inc. (a Nevada corporation formerly known as Marine Jet
Technology  Corp.) was  incorporated in the State of Nevada on February 9, 2000.
On April 14, 2005, Blue Holdings  entered into an Exchange  Agreement with Antik
Denim,  L.L.C.  ("Antik"),  a California  Limited Liability Company organized on
September  13,  2004.  At the closing of the  transactions  contemplated  by the
exchange agreement, which occurred on April 29, 2005, Blue Holdings acquired all
of the  outstanding  membership  interests of Antik (the  "Interests")  from the
members of Antik,  and the members  contributed  all of their  Interests to Blue
Holdings.  In exchange,  Blue Holdings  issued to the members  843,027 shares of
Series A  Convertible  Preferred  Stock,  par value  $0.001 per  share,  of Blue
Holdings ("Preferred  Shares"),  which, on June 7, 2005, as a result of a change
to Marine Jet  Technology  Corp.'s  name to Blue  Holdings,  Inc. and a 1 for 29
reverse stock split,  were  converted into  24,447,783  shares of Blue Holding's
common  stock on a  post-reverse  stock  split  basis  (see Note  14).  As such,
immediately  following  the closing  and upon the  conversion  of the  Preferred
Shares, the Antik members owned 95.8% of the total issued and outstanding common
stock of Blue Holdings on a  fully-diluted  basis.  Following  completion of the
exchange transaction,  Antik became a wholly-owned  subsidiary of Blue Holdings.
The acquisition is accounted for as a reverse merger  (recapitalization)  in the
accompanying  financial  statements  with  Antik  deemed  to be  the  accounting
acquirer,  and  Blue  Holdings  deemed  to be the  legal  acquirer.  As such the
financial  statements  herein are those of Antik since  September  13, 2004 (the
date of its  inception).  All assets and  liabilities  of Marine Jet  Technology
Corp. were assumed by the major shareholder of Blue Holdings,  Inc. prior to the
exchange transaction and were inconsequential to the merged companies.

         On June 7, 2005,  Marine Jet Technology Corp.  changed its name to Blue
Holdings  Inc.,  and  increased  its  authorized   number  of  common  stock  to
75,000,000.

         Pursuant to the provisions of the Exchange  Agreement  with Antik,  the
former members of Antik agreed that, in the event that the stockholders'  equity
of  Blue  Holdings  (on a  consolidated  basis  following  the  closing  of  the
transactions  contemplated  by the  Exchange  Agreement)  as  reported  in  Blue
Holdings' Quarterly Report on Form 10-Q for the quarter ended June 30, 2005 (the
"Consolidated  Equity")  was less than  $5,000,000,  the  former  members  would
contribute,  within  fifteen  (15) days  following  the filing of such  periodic
report,  equity  capital to Blue  Holdings in an amount equal to the  difference
between $5,000,000 and the actual  Consolidated Equity reported in such periodic
report  ("Required  Contribution").  In the case of such Required  Contribution,
each of the Antik members  agreed that no additional  shares of capital stock of
Blue Holdings would be issued in  consideration  of such Required  Contribution,
and therefore,  the existing  shareholders of Blue Holdings,  including  Antik's
former  members,  would not be further  diluted.  By an amendment dated June 27,
2005, the date of June 30, 2005 for calculation of the  consolidated  equity was
amended to September 30, 2005.

(b)      NATURE OF OPERATIONS:

         The Company operates exclusively in the wholesale apparel industry. The
Company  designs,  develops,  markets and  distributes  high  fashion  jeans and
accessories  under the brand name "Antik  Denim," and as of July 5, 2005,  under
the brand name "Yanuk." The Company's  products include jeans,  jackets,  belts,
purses and  T-shirts.  The Company  currently  sells its  products in the United
States,  Canada,  Japan and the European Union directly to department stores and
boutiques   and   through   distribution   arrangements   in   certain   foreign
jurisdictions.   The  Company  is  headquartered  in  Commerce,  California  and
maintains two showrooms in New York and Los Angeles.


                                      F-7



NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(a)      USE OF ESTIMATES:

         The  preparation of financial  statements in conformity with accounting
principles  generally  accepted  in  the  United  States  of  America,  requires
management to make estimates and assumptions that affect the reported amounts of
assets and  liabilities  and disclosure of contingent  assets and liabilities at
the date of the financial  statements  and the reported  amounts of revenues and
expenses  during the reporting  period.  Actual  results could differ from these
estimates.

(b)      INVENTORY VALUATION:

         Inventories  are  stated  at the  lower  of cost  (first-in,  first-out
method) or market.

(c)      REVENUE RECOGNITION:

         Revenue is recognized when merchandise is shipped to the customer based
upon agreed  terms and is recorded net of  estimated  returns,  charge backs and
markdowns  based upon  management's  estimates  and  historical  experience.  We
sometimes arrange, on behalf of manufacturers, for the purchase of fabric from a
single supplier.  We have the fabric shipped directly to the cutting factory and
invoice the factory for the  fabric.  The  factories  then pay us for the fabric
with offsets against the price of the finished goods.

(d)      ADVERTISING:

         Advertising costs are expensed as of the first date the  advertisements
take  place.  Advertising  expenses  included in selling  expenses  approximated
$3,500 for the period from  September 13, 2004  (inception) to December 31, 2004
and $61,501 for the six months ended June 30, 2005.

(e)      PROPERTY AND EQUIPMENT:

         Property and equipment is stated at cost.  Depreciation  is provided by
the straight-line method at rates calculated to amortize cost over the estimated
useful lives of the respective assets.

         Upon  sale  or  retirement  of  such  assets,   the  related  cost  and
accumulated  depreciation  are eliminated  from the accounts and gains or losses
are  reflected  in  operations.   Repairs  and  maintenance   expenditures   not
anticipated to extend asset lives are charged to operations as incurred.

(f)      INCOME TAXES:

         Antik  Denim  was a limited  liability  company  with  four  individual
members up until April 29, 2005. After the exchange  transaction,  Blue Holdings
Inc. became the sole member of the limited liability  company.  As a result, the
company's tax status changed from a limited  liability company to a corporation,
Antik is no longer a pass through entity for U.S.  income tax purposes.  Federal
and State income tax  obligations  for the period prior to April 29, 2005,  were
passed  through to the previous  members of Antik,  and the Company  recorded no
provision  for such taxes.  The Company has agreed with the previous  members of
the limited  liability  company that the Company will not make any distributions
to pay tax liabilities,  if any, on income earned prior to the acquisition date,
April 29, 2005.  Consequently,  the taxes on the income of the limited liability
company are payable individually by each member.

         The  Company  uses the asset and  liability  method to account  for its
income  taxes.  The  Company's  provision  for income taxes at June 30, 2005 was
based on income for the period  from April 30, 2005 to June 30, 2005 as adjusted
for timing  differences  outstanding  at the date that Blue Holdings  became the
sole member of the limited liability company.


                                      F-7



         The  Company  recognizes  deferred  taxation on  temporary  differences
between income tax liability for financial statement and income tax purposes. At
June 30, 2005 the deferred tax asset amounted to $197,580  relating  principally
to the valuation reserves recorded for Generally Accepted  Accounting  Principle
purposes.

(g)      IMPAIRMENT OF LONG-LIVED ASSETS AND INTANGIBLES:

         Long-lived  assets  are  reviewed  for  impairment  whenever  events or
changes in  circumstances  indicate that the carrying amount of an asset may not
be  recoverable.  Recoverability  of assets to be held and used is measured by a
comparison of the carrying  amount of an asset to future net cash flows expected
to be generated by the asset. If such assets are considered to be impaired,  the
impairment  to be  recognized  is measured  by the amount by which the  carrying
amount of the assets exceeds the fair value of the assets. Assets to be disposed
of are reported at the lower of the carrying  amount or fair value less costs to
sell.

(h)      CONCENTRATION OF CREDIT RISK:

         Financial instruments,  which potentially expose us to concentration of
credit risk, consist primarily of cash, trade accounts  receivable,  and amounts
due from the factor. Concentration of credit risk with respect to trade accounts
receivable  at December  31, 2004 and June 30, 2005 is limited due to the number
of  customers  comprising  the  Company's  customer  base and  their  dispersion
throughout  the United  States.  The  Company  extends  unsecured  credit to its
customers in the normal course of business.

         The Company's cash balances on deposit with banks are guaranteed by the
Federal Deposit Insurance Corporation up to $100,000. The Company may be exposed
to risk for the  amounts  of funds  held in one bank in excess of the  insurance
limit. In assessing the risk, the Company's  policy is to maintain cash balances
with high quality financial institutions.

         The  Company's  products are primarily  sold to  department  stores and
specialty  retail  stores.  These  customers  can be  significantly  affected by
changes in economic, competitive or other factors. The Company makes substantial
sales to a relatively  few,  large  customers.  In order to minimize the risk of
loss, the Company  assigns certain amount of domestic  accounts  receivable to a
factor without  recourse or requires  letters of credit from its customers prior
to the  shipment  of goods.  For  non-factored  receivables,  account-monitoring
procedures  are utilized to minimize the risk of loss.  Collateral  is generally
not required.  No single customer  accounted for more than 10% of total sales in
the six months ended June 30, 2005, and only one customer accounted for 7.7% and
4.2% respectively of total sales.

(i)      MERCHANDISE RISK:

         The Company's  success is largely  dependent  upon its ability to gauge
the  fashion  tastes of its  targeted  consumers  and provide  merchandise  that
satisfies consumer demand. Any inability to provide  appropriate  merchandise in
sufficient quantities in a timely manner could have a material adverse effect on
the Company's business, operating results and financial condition.

(j)      ACCOUNTS RECEIVABLE - ALLOWANCE FOR RETURNS, DISCOUNTS AND BAD DEBTS:

         The Company  evaluates the  collectibility  of accounts  receivable and
chargebacks (disputes from the customer) based upon a combination of factors. In
circumstances where the Company is aware of a specific  customer's  inability to
meet its financial  obligations  (such as in the case of  bankruptcy  filings or
substantial  downgrading by credit sources), a specific reserve for bad debts is
taken against amounts due to reduce the net recognized  receivable to the amount
reasonably  expected  to be  collected.  For all other  customers,  the  Company
recognizes  reserves for bad debts and  uncollectible  charge backs based on its
historical collection  experience.  If collection  experience  deteriorates (for
example,  due to an unexpected  material  adverse  change in a major  customer's
ability to meet its financial obligations to the Company),  the estimates of the
recoverability of amounts due could be reduced by a material amount.


                                      F-8



(k)      SHIPPING AND HANDLING COSTS:

         Freight   charges   are   included   in   selling,   distribution   and
administrative  expenses in the statement of operations and approximated $23,000
for the period  ended  December  2004 and $117,933 for the six months ended June
30, 2005.

(l)      INCOME (LOSS) PER COMMON SHARE

         Basic net income  (loss) per share is calculated by dividing net income
(loss) available to common stockholders by the weighted average number of common
shares  outstanding  during  the  period.  Diluted  income  (loss)  per share is
calculated  assuming the issuance of common shares, if dilutive,  resulting from
the exercise of stock options and warrants. During the period ended December 31,
2004 and the six months ended June 30, 2005, the Company did not have any common
stock  equivalents  outstanding.  The weighted  average  number of common shares
outstanding,  basic and diluted,  shown in the statement of  operations  for the
period  ended  December  31,  2004,  represent  the shares  issued to the former
members of Antik  Denim,  L.L.C.  upon the reverse  merger as if it had occurred
during 2004.

(m)      RECENT ACCOUNTING PRONOUNCEMENTS

         In December  2004,  the FASB issued  Statement of Financial  Accounting
Standard  ("SFAS") No. 123R "Share Based  Payment." This statement is a revision
of SFAS  Statement  No.  123,  "Accounting  for  Stock-Based  Compensation"  and
supersedes APB Opinion No. 25,  "Accounting  for Stock Issued to Employees," and
its related  implementation  guidance.  SFAS 123R  addresses  all forms of share
based  payment  ("SBP")  awards  including  shares issued under  employee  stock
purchase plans, stock options,  restricted stock and stock appreciation  rights.
Under SFAS 123R, SBP awards result in a cost that will be measured at fair value
on the awards'  grant  date,  based on the  estimated  number of awards that are
expected to vest.  This statement  will become  effective for the Company during
the first quarter of 2006. The Company has evaluated the effects of the adoption
of this  pronouncement  and has determined it will not have a material impact on
the Company's financial statements.

         In March, 2005, the Securities and Exchange Commission's ("SEC") Office
of the  Chief  Accountant  and its  Division  of  Corporation  Finance  released
Financial Accounting Bulletin No. 107,  "Share-Based Payment" (SAB 107). SAB 107
provides  interpretive  guidance related to the interaction between Statement of
Financial  Accounting  Standard No. 123R "Shared Based  Payment" (SFAS 123R) and
certain SEC rules and regulations.  SAB 107 provides the staff's views regarding
the valuation of  shared-based  payment  arrangements  for public  companies and
stresses the importance of including appropriate disclosures within SEC filings,
particularly during the transition to SFAS 123R.

         In  December  2004,  the  FASB  issued  SFAS  No.  153,  "Exchanges  of
Nonmonetary  Assets,  an amendment to APB Opinion No. 29" ("SFAS No. 153"). SFAS
No. 153 amends  Accounting  Principles  Board  Opinion No. 29,  "Accounting  for
Nonmonetary  Transactions",  to require that exchanges of nonmonetary  assets be
measured and accounted for at fair value, rather than at carryover basis, of the
assets  exchanged.  Nonmonetary  exchanges  that lack  commercial  substance are
exempt  from  this  requirement.  SFAS  No.  153 is  effective  for  nonmonetary
exchanges  entered into in fiscal  periods  beginning  after June 15, 2005.  The
Company does not routinely enter into nonmonetary  exchanges.  Accordingly,  the
Company  does  not  expect  that  the  adoption  of SFAS  No.  153  will  have a
significant  effect  on  the  Company's  financial  statement   presentation  or
disclosures.


                                      F-9



NOTE 3 - DUE FROM FACTOR

         The Company uses a factor for working capital and credit administration
purposes.  Under the  factoring  agreement,  the factor  purchases a substantial
portion of the trade  accounts  receivable  and  assumes  all  credit  risk with
respect to such accounts. The factor agreement,  which terminates on October 18,
2005,  provides  that the Company can borrow an amount up to 85% of the value of
its  approved  factored  customer  invoices,  less a  reserve  of 15% of  unpaid
accounts purchased and 100% of all such accounts which are disputed.

         The amount of reserve held by the Factor was approximately  $89,641 and
$464,000 as of December 31, 2004 and June 30, 2005, respectively.

         The factor commission is 0.08% of the customer invoice amount for terms
up to 90 days,  plus one  quarter  of one  percent  (.25%)  for each  additional
thirty-day  term.  Receivables  sold in excess of  maximums  established  by the
factor are subject to recourse in the event of nonpayment  by the customer.  The
Company is contingently liable to the factor for merchandise disputes,  customer
claims and the like on receivables sold to the factor. Items subject to recourse
approximated  $998,863 as of June 30, 2005. To the extent that the Company draws
funds prior to the deemed collection date of the accounts receivable sold to the
factor,  interest is charged at the rate of 1% over the factor's  prime  lending
rate per annum.  Factor  advances  and  ledger  debt are  collateralized  by the
non-factored accounts receivable,  inventories and the personal guarantee of the
majority  shareholder and a company  co-owned by the majority  shareholder  (see
Note 14).

NOTE 4 - INVENTORIES

         Inventories are summarized as follows:

                                          DECEMBER 31,        JUNE 30,
                                             2004               2005
                                          ----------         ----------
                                                             (Unaudited)

         Raw Materials ..........         $  699,398         $2,511,503
         Work-in-process ........               --            1,301,764
         Finished goods .........            112,790          1,617,390
                                          ----------         ----------
                                          $  812,188         $5,430,657
                                          ==========         ==========

NOTE 5 - PROPERTY AND EQUIPMENT

         Property and equipment is summarized as follows:

                                              DECEMBER 31,     JUNE 30,
                                                 2004           2005
                                               --------       --------
                                                             (Unaudited)

         Furniture ......................      $  1,064       $  1,064
         Leasehold improvements .........         7,000          7,000
         Computer equipment .............         2,808          2,808
                                               --------       --------
                                                 10,872         10,872
         Less: Accumulated depreciation .          (389)        (1,445)
                                               --------       --------
         Net ............................      $ 10,483       $  9,427
                                               ========       ========


                                      F-10



NOTE 6 - RELATED PARTY TRANSACTIONS

         During the period from  inception,  September 13, 2004, to December 31,
2004 and for the six months ended June 30, 2005, the Company reimbursed $390,185
and $624,295 respectively for certain expenses (consisting of salaries,  payroll
taxes,  utilities,  common  area  services,  rent,  insurance  and other  office
services)  to Blue  Concept,  LLC, an entity that is co-owned by a member of the
Company.  These  amounts were for the benefit of the Company and are included in
operating expenses in the accompanying Statement of Operations.  The arrangement
was formalized under a Service Agreement signed on May 18, 2005.

         The Company had sales to certain  entities  controlled by the principal
stockholder  of $766,511  during the six months ended June 30, 2005.  Before the
exchange transaction,  the sales terms were at a mark-up over cost approximately
20% discount from regular  wholesale  price. The terms for all future sales were
changed to regular wholesale prices after the exchange transaction with Antik.

         The Company  also  purchased  fabric at cost from Blue  Concept LLC, an
entity  co-owned by Paul and  Elizabeth  Guez,  the  Company's  Chairman,  Chief
Executive  Officer and  President,  and Chief  Operating  Officer,  respectively
("Blue Concept"), $459,864 during the six months ended June 30, 2005.

         During the period from inception  through  December 31, 2004, Paul Guez
and several companies co-owned by Paul Guez,  provided advance loans to Antik in
the form of  inventory  with a fair  market  value at cost,  or cash for working
capital  purposes,  in an amount equal to $246,857.  The advances were unsecured
and  non-interest  bearing,  with no formal terms of  repayment.  As of June 30,
2005, the principal amount outstanding for such advances was equal to $150,995.

         The majority  shareholders and Blue Concept have personally  guaranteed
all advances due to the Company's factor.

NOTE 7 - DUE FROM/TO RELATED PARTIES

         The related parties are the majority  shareholder and Limited Liability
Companies  that are co-owned by a majority  shareholder of the Company (see Note
11).  These amounts are all unsecured and  non-interest  bearing.  All non-trade
related   advances  from  related   parties  have  been  repaid.   Trade-related
outstanding items follow regular payment terms as invoiced.

NOTE 8 - MAJOR SUPPLIERS

         During the period from  inception,  September 13, 2004, to December 31,
2004,  two suppliers  comprised  greater than 10% of the  Company's  piece goods
purchases. Purchases from these suppliers were 51.3% and 34.1%, respectively.

         During  the six  months  ended  June 30,  2005 one  supplier  comprised
greater  than 10% of the  Company's  purchases.  Purchases  from  this  supplier
comprised 13.3%.

NOTE 9 - FAIR VALUE OF FINANCIAL INSTRUMENTS

         The carrying amounts of Cash, Due from factor, Accounts receivable, Due
from  related  parties,  Accounts  payable,  Due  to  related  parties,  Due  to
customers, Accrued expenses and other current liabilities approximate fair value
because of the short maturity of these items.


                                      F-11



NOTE 10 - OFF-BALANCE SHEET RISK

         Financial   instruments  that   potentially   subject  the  Company  to
off-balance sheet risk consist of factored accounts receivable.  As described in
Note 3, the Company  sells the majority of its trade  accounts  receivable  to a
factor and is  contingently  liable to the factor for  merchandise  disputes and
other  customer  claims.  At December 31, 2004 and June 30,  2005,  total factor
receivables approximated $515,000 and $449,000 respectively.

NOTE 11 - CAPITAL CONTRIBUTION

         Antik Denim,  L.L.C.  was formed on September  13, 2004 with 4 members,
one of which had a 75.4% ownership interest,  and the other 3 members each had a
8.2%  ownership  interest.   Member  contributions  in  cash  were  as  follows:
contributions  of $500,000 by the 75.4% member and a contribution of $250,000 by
an 8.2% member.  The other 8.2% members each  contributed  patent and  trademark
applications,  design  concepts  and  other  items  to form a  complete  line of
high-end fashion apparel.  For financial statement purposes,  the Company valued
each of the  contributions at $250,000  ($500,000 in total),  which was equal to
the cash  consideration  paid by the other 8.2%  member.  The  $500,000 has been
reflected as non-cash  development  costs in the statement of operations for the
period ended December 31, 2004.

         The members' equity account, as of December 31, 2004, was as follows:

         Contributions by a 75.4 % member- cash ..........      $   500,000
         Contributions by a 8.2 % member- cash ...........          250,000
         Contributions by two 8.2% members ($250,000 each)
             - non-cash development costs ................          500,000
                                                                -----------

                                              Total ......        1,250,000

              Less Net Loss ..............................       (1,131,755)

              Less Members' withdrawals ..................          (79,190)
                                                                -----------

              Balance at the end of the period ...........      $    39,055
                                                                ===========

         During  2005,   Mr.  Guez,   the  principal   shareholder,   personally
contributed  $1,200,000 in fabric inventory and $686,200 in cash to the Company.
From time to time, he also supports the Company with temporary  advances.  As of
June 30, 2005,  the Company had advances  totaling  $141,549 from Mr. Guez which
are included in due to related parties on the accompanying balance sheet.

NOTE 12 - COMMON STOCK ISSUABLE

         As of June 30, 2005, the Company has recorded 102, 079 shares of common
stock to be issued to Alan Kersh as a finder's  fee to  facilitate  the exchange
transaction.  The shares  were  subsequently  issued on August 18,  2005.  These
shares were valued at $177,617  based upon the market  price of the stock on the
date of the agreement.


                                      F-12



NOTE 13- STOCK INCENTIVE PLAN

         Our 2005 Stock  Incentive Plan was adopted and became  effective in May
2005.  A total of  2,500,000  shares of common  stock  have  been  reserved  for
issuance upon exercise of awards  granted under the 2005 Stock  Incentive  Plan.
Any shares of common stock subject to an award,  which for any reason expires or
terminates  unexercised,  are again  available for issuance under the 2005 Stock
Incentive Plan.

         Our 2005 Stock  Incentive Plan will  terminate  after 10 years from the
date on which our board  approved the plan,  unless it is terminated  earlier by
our board.  The plan  authorizes  the award of stock options and stock  purchase
grants.

         Our 2005  Stock  Incentive  Plan is  administered  by our full board of
directors.  To the extent we expand our board of directors,  we intend to form a
compensation  committee,  all  of the  members  of  which  will  be  independent
directors under  applicable  federal  securities  laws and outside  directors as
defined  under  applicable  federal  tax  laws.  Following  its  formation,  the
compensation  committee  will have the  authority to construe and  interpret the
plan, grant awards and make all other determinations  necessary or advisable for
the administration of the plan.

         Our 2005 Stock  Incentive Plan provides for the grant of both incentive
stock options that qualify  under  Section 422 of the Internal  Revenue Code and
nonqualified  stock  options.  Incentive  stock  options may be granted  only to
employees  of ours or any parent or  subsidiary  of ours.  All awards other than
incentive  stock options may be granted to our employees,  officers,  directors,
consultants,  independent  contractors  and  advisors  of ours or any  parent or
subsidiary  of ours.  The exercise  price of incentive  stock options must be at
least equal to the fair market  value of our common  stock on the date of grant.
The exercise price of incentive stock options granted to 10%  shareholders  must
be at least  equal to 110% of that value.  The  exercise  price of  nonqualified
stock options will be determined by our compensation  committee when the options
are granted.

         In  general,  options  will vest over a four-year  period.  The term of
options granted under our 2005 Stock Incentive Plan may not exceed 10 years.

         Awards  granted  under  our  2005  Stock  Incentive  Plan  may  not  be
transferred  in any  manner  other  than by will or by the laws of  descent  and
distribution or as determined by our  compensation  committee.  Unless otherwise
restricted  by our  compensation  committee,  nonqualified  stock options may be
exercised  during  the  lifetime  of the  optionee  only  by the  optionee,  the
optionee's  guardian or legal  representative or a family member of the optionee
who has acquired the option by a permitted transfer. Incentive stock options may
be exercised  during the  lifetime of the  optionee  only by the optionee or the
optionee's  guardian or legal  representative.  Options  granted  under our 2005
Stock  Incentive  Plan  generally  may be exercised for a period of three months
after  the  termination  of the  optionee's  service  with us or any  parent  or
subsidiary  of  ours.   Options  will  generally   terminate   immediately  upon
termination of employment for cause.

         The purchase price for restricted stock will be determined by our board
of directors or  compensation  committee,  as applicable,  at the time of grant.
Stock  bonuses  may be  issued  for past  services  or may be  awarded  upon the
completion of services or performance goals.

         If we are subject to a change in control  transaction,  all outstanding
awards may be assumed  or  replaced  with a  substitute  grant by the  successor
company,  if any.  If the  outstanding  awards are not  assumed  by a  successor
company, if any, then all remaining  unexercised options shall become vested and
fully exercisable.


                                      F-13



NOTE 14 - SUBSEQUENT EVENTS

         On July 5, 2005, the Company entered into a ten-year license  agreement
with Yanuk. Under the terms of the agreement,  the Company will be the exclusive
licensor  for  the  design,  development,   manufacture,   sale,  marketing  and
distribution of Yanuk's "Yanuk" brand products.  The Company will pay to Yanuk a
royalty  of six  percent  of all net sales and  shall pay a  guaranteed  minimum
royalty on a quarterly  basis.  Also the company has the option to purchase from
Yanuk the property licensed under the agreement.

         On July 8, 2005, we entered into an Employment  Agreement with Philippe
Naouri based on the foregoing  letter  agreement  entered into with Antik.  This
agreement was amended on August 23, 2005.  Pursuant to the terms of Mr. Naouri's
employment  agreement,  as  amended,  Mr.  Naouri was engaged by us as a fashion
director  and  senior  vice   president   in  charge  of  design,   development,
manufacturing,  marketing  and  wholesale  of apparel  and  related  accessories
bearing the "Antik Denim" trademark for a term of 5 years commencing on July 11,
2005 and  terminating on July 10, 2010. Mr. Naouri will receive an annual salary
of $240,000.

         On August  27,  2005,  the  Company  opened a retail  store on  Melrose
Avenue,  Los Angeles,  California and took over all the obligations of a 10-year
property  lease which was entered  into by Blue  Concept LLC in April 2005.  The
lease  will  expire on March 15,  2015 and will be  classified  as an  operating
lease.  The monthly  base rent is $16,925  plus common area  maintenance  costs,
utility  services and taxes. The base rent will be adjusted  annually  beginning
April 2006 between 2.5%-3.5% per annum.

         The factor  agreement  with FTC  Commercial  Corp.  has been amended to
terminate  on July 24, 2006 and includes  Blue  Holdings  Inc. as an  additional
borrower.  The  amendments,  dated to be  effective  July 25,  2005,  also  make
available to both Blue Holdings Inc and Antik Denim,  L.L.C.  a combined line of
credit up to $1.5 million against inventory.  We can borrow against inventory up
to 33.3% of the value of eligible raw materials and finished  goods.  By another
amendment dated September 1, 2005, the advance ratio against  approved  factored
invoices  has been  revised  to 90%.  Furthermore,  the credit  facilities  will
automatically  be renewed after July 24, 2006 and will  thereafter be subject to
120 days' termination notice from either party.

         Subsequent  to June 30,  2005,  the  Company  issued a total of  13,493
additional  shares  to  holders  of  the  pre-stock-split  shares  for  rounding
purposes.

         In August 2005, we granted each of Messrs.  Keating and Geller, our two
non-employee  directors, an option to purchase 30,000 shares of our common stock
at an exercise  price of $8.10 per share.  These  options were granted under our
2005 Stock Incentive Plan. At the same time, we granted to Mr. Keating an option
to purchase an additional  2,000 shares of our common stock at an exercise price
of $8.10 per share in  consideration  for his service as Chairman of the Board's
Audit Committee.

         On  October 6, 2005,  the  Company  entered  into a  five-year  License
Agreement,  effective October 5, 2005, with Yanuk Jeans LLC ("Yanuk"), a related
party.  Under  the  terms of the  License  Agreement,  the  Company  will be the
exclusive licensor for the design, development, manufacture, sale, marketing and
distribution  of Yanuk's "U" brand  products.  The  Company  will pay to Yanuk a
royalty  of five  percent  of all net sales and shall pay a  guaranteed  minimum
royalty on an annual  basis.  Also the company  has the option to purchase  from
Yanuk the property licensed under the agreement.


                                      F-14



                                     PART II
                     INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 24. INDEMNIFICATION OF DIRECTORS AND OFFICERS.

         The Nevada Revised Statutes and certain  provisions of our Bylaws under
certain circumstances provide for indemnification of our officers, directors and
controlling persons against liabilities which they may incur in such capacities.
A summary of the circumstances in which such  indemnification is provided for is
contained herein, but this description is qualified in its entirety by reference
to our bylaws and to the statutory provisions.

         In general, any officer, director, employee or agent may be indemnified
against expenses,  fines,  settlements or judgments arising in connection with a
legal  proceeding to which such person is a party, if that person's actions were
in good faith, were believed to be in our best interest,  and were not unlawful.
Unless  such  person  is   successful   upon  the  merits  in  such  an  action,
indemnification  may be  awarded  only  after  a  determination  by  independent
decision  of the  board  of  directors,  by legal  counsel,  or by a vote of the
shareholders,  that the applicable  standard of conduct was met by the person to
be indemnified.

         The circumstances under which  indemnification is granted in connection
with an action  brought on our behalf is  generally  the same as those set forth
above;  however,  with respect to such actions,  indemnification is granted only
with respect to expenses  actually  incurred in  connection  with the defense or
settlement of the action.  In such actions,  the person to be  indemnified  must
have  acted in good  faith  and in a manner  believed  to have  been in our best
interest, and have not been adjudged liable for negligence or misconduct.

         Indemnification may also be granted pursuant to the terms of agreements
which may be entered  in the future or  pursuant  to a vote of  shareholders  or
directors.  The statutory  provision  cited above also grants the power to us to
purchase  and maintain  insurance  which  protects  our  officers and  directors
against any  liabilities  incurred in  connection  with their  service in such a
position, and such a policy may be obtained by us.

         We have entered into separate but identical Indemnification  agreements
(the  "Indemnification  Agreements")  with each of our  directors  and executive
officers  (the  Indemnitees").  Pursuant  to the  terms  and  conditions  of the
Indemnification  Agreements,  we indemnified each Indemnitee against any amounts
which he or she becomes  legally  obligated to pay in connection  with any claim
against him or her based upon any action or inaction which he or she may commit,
omit or suffer while acting in his or her capacity as a director  and/or officer
of us or our subsidiaries,  provided, however, that the Indemnitee acted in good
faith and in a manner Indemnitee  reasonably believed to be in or not opposed to
our best interests and, with respect to any criminal  action,  had no reasonable
cause to believe Indemnitee's conduct was unlawful.

         A shareholder's  investment may be adversely  affected to the extent we
pay the costs of settlement and damage awards against  directors and officers as
required by these indemnification  provisions.  At present,  there is no pending
litigation or proceeding  involving any of our directors,  officers or employees
regarding  which  indemnification  by us is  sought,  nor  are we  aware  of any
threatened litigation that may result in claims for indemnification.

         Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors,  officers or persons  controlling us pursuant
to the foregoing  provisions,  we have been informed that, in the opinion of the
SEC,  this  indemnification  is  against  public  policy  as  expressed  in  the
Securities Act and is therefore unenforceable.


                                      II-1



         Reference is made to the following  documents filed as exhibits to this
Registration Statement regarding relevant  indemnification  provisions described
above and elsewhere herein:

                                                                      EXHIBIT
EXHIBIT DOCUMENT                                                      NUMBER
                                                                   -------------

Articles of Incorporation of Registrant, as amended........             3.1
Bylaws of Registrant.......................................             3.2
Form of Indemnification Agreement..........................            10.7


ITEM 25.  OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.

         The following table itemizes the expenses incurred by the Registrant in
connection  with the offering.  All the amounts  shown are estimates  except the
Securities and Exchange Commission registration fee.

                                                                          AMOUNT
                                                                         -------

Registration fee - Securities and Exchange Commission ..........         $ 3,021
Legal fees and expenses ........................................         $10,000
Accounting fees and expenses ...................................         $10,000
Miscellaneous expenses .........................................         $ 1,000
                                                                         -------
     Total .....................................................         $24,021


ITEM 26. RECENT SALES OF UNREGISTERED SECURITIES.

         On April 14, 2005, we entered into an Exchange Agreement (the "Exchange
Agreement") with Antik Denim,  L.L.C., a California  limited  liability  company
("Antik"), the members of Antik (the "Antik Members"), and KRM Fund. The closing
of the transactions contemplated by the Exchange Agreement occurred on April 29,
2005. At the closing, we acquired all of the outstanding membership interests of
Antik  (the  "Interests")  from  the  Antik  Members,   and  the  Antik  Members
contributed  all of their  Interests to us. In exchange,  we issued to the Antik
Members 843,027 shares of our Series A Convertible  Preferred  Stock,  par value
$0.001 per share (the "Preferred Shares"), which, as a result of the approval by
a substantial majority of our outstanding  shareholders entitled to vote and the
approval  by  our  Board  of  Directors,   of  amendments  to  our  Articles  of
Incorporation  that (i) changed our name to Blue Holdings,  Inc., (ii) increased
our authorized number of shares of common stock to 75,000,000, and (iii) adopted
a 1-for-29  reverse  stock split,  on June 7, 2005  converted  into  708,984,875
shares of our common  stock on a  pre-reverse  stock split basis and  24,447,783
shares of our common stock on a post-reverse stock split basis.

         The issuance of the Preferred Shares and, upon  conversion,  the shares
of our common stock  underlying the Preferred  Shares,  to the Antik Members was
exempt from  registration  under the  Securities  Act of 1933,  as amended  (the
"Securities Act"), pursuant to Section 4(2) thereof.

         We made this  determination  based on the  representations of the Antik
Members which included,  in pertinent  part, that such members were  "accredited
investors"  within the meaning of Rule 501 of Regulation D promulgated under the
Securities Act, that such members were acquiring the Preferred  Shares,  and the
shares of our common stock  underlying  the  Preferred  Shares,  for  investment
purposes for their own  respective  accounts and not as nominees or agents,  and
not with a view to the  resale or  distribution  thereof,  and that each  member
understood that the Preferred Shares, and the shares of our


                                      II-2



common  stock  underlying  the  Preferred  Shares,  may not be sold or otherwise
disposed  of without  registration  under the  Securities  Act or an  applicable
exemption therefrom.

         Pursuant to an oral  agreement  entered  into  between  Antik and Savoy
Capital  Advisors Inc.  ("Savoy") on March 24, 2005, we issued to Mr. Alan Kersh
on August 18, 2005, in accordance  with a certain  Restated  Finders  Agreement,
102,079  shares of our  common  stock (on a  post-reverse-stock-split  basis) in
consideration  for  certain  finder  services  provided in  connection  with the
exchange  transaction  with  Antik.  Pursuant  to that  agreement,  we agreed to
register the shares issued to Mr. Kersh under certain terms and  conditions.  On
September 13, 2005, we filed with the U.S.  Securities and Exchange Commission a
registration  statement on Form SB-2 (File #: 333-128288) to register for resale
the shares held by Mr. Kersh.  The issuance of the shares of common stock to Mr.
Kersh was exempt from registration  under the Securities Act pursuant to Section
4(2) thereof.  We made this  determination  based on the  representations of Mr.
Kersh which included,  in pertinent  part,  that he is an "accredited  investor"
within the meaning of Rule 501 of Regulation D promulgated  under the Securities
Act, that he was acquiring  the shares of common stock for  investment  purposes
for his own  account  and not as  nominee  or agent,  and not with a view to the
resale or distribution thereof, and that he understood that the shares of common
stock may not be sold or otherwise  disposed of without  registration  under the
Securities Act or an applicable exemption therefrom.


                                      II-3



ITEM 27. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.

         (a)      The following exhibits are filed herewith:

EXHIBIT
NUMBER                                    EXHIBIT TITLE
-------           --------------------------------------------------------------

2.1               Exchange  Agreement dated April 14, 2005, among Blue Holdings,
                  Inc.  (formerly known as Marine Jet Technology  Corp.),  Antik
                  Denim,  L.L.C., each member of Antik Denim, L.L.C. and Keating
                  Reverse Merger Fund, LLC. (1)

2.2               First  Amendment  to Exchange  Agreement  dated June 27, 2005,
                  among Blue Holdings, Inc., Antik Denim, L.L.C., each member of
                  Antik Denim, L.L.C. and Keating Reverse Merger Fund, LLC. (2)

3.1               Articles of  Incorporation of the Registrant filed February 9,
                  2000. (3)

3.1.1             Certificate of Amendment of Articles of  Incorporation  of the
                  Registrant filed December 5, 2000. (3)

3.1.2             Certificate of Amendment of Articles of  Incorporation  of the
                  Registrant filed January 5, 2001. (3)

3.1.3             Certificate of Amendment of Articles of  Incorporation  of the
                  Registrant filed May 16, 2005 and effective June 7, 2005. (4)

3.2               Bylaws of the Registrant adopted February 12, 2000. (3)

4.1               Articles of  Incorporation of the Registrant filed February 9,
                  2000. (3)

4.2               Certificate of Amendment of Articles of  Incorporation  of the
                  Registrant filed December 5, 2000. (3)

4.3               Certificate of Amendment of Articles of  Incorporation  of the
                  Registrant filed January 5, 2001. (3)

4.4               Certificate of Amendment of Articles of  Incorporation  of the
                  Registrant filed May 16, 2005 and effective June 7, 2005. (4)

4.5               Bylaws of the Registrant adopted February 12, 2000. (3)

5.1               Opinion of Stubbs Alderton & Markiles, LLP.

10.1              Assumption   Agreement  dated  January  20,  2005,  among  the
                  Registrant, Intellijet Marine, Inc. and Jeff P. Jordan. (6)

10.2              Financial Advisory Agreement dated April 29, 2005, between the
                  Registrant and Keating Securities, LLC. (5)

10.3              License  Agreement dated July 5, 2005,  between the Registrant
                  and Yanuk Jeans, LLC. (7)

10.4              Employment   Agreement   dated  July  8,  2005,   between  the
                  Registrant and Philippe Naouri. (8)

10.5              Service  Agreement  dated May 18, 2005,  between  Antik Denim,
                  L.L.C. and Blue Concepts, LLC. (9)

10.6              First Amendment to Employment  Agreement dated August 1, 2005,
                  between the Registrant and Philippe Naouri. (10)

10.7              Form of  Indemnification  Agreement between the Registrant and
                  each of its executive officers and directors. (11)


                                      II-4



10.8              License  Agreement  dated to be  effective  October  5,  2005,
                  between the Registrant and Yanuk Jeans, LLC. (12)

23.1              Consent of Weinberg & Company, P.C.

23.2              Consent of Stubbs Alderton & Markiles LLP (included in Exhibit
                  5.1).

24.1              Power of Attorney  (included as part of the Signature  Page of
                  this Registration Statement).

99.1              2005 Stock  Incentive Plan and Form of Stock Option  Agreement
                  of the Registrant. (4)

----------
(1)      Filed previously as Exhibit 2.5 to the  Registrant's  Current Report on
         Form 8-K (File #:  000-33297),  filed with the  Securities and Exchange
         Commission  on  April  15,  2005,  and  incorporated   herein  by  this
         reference.
(2)      Filed previously as Exhibit 2(e) to the Registrant's  Current Report on
         Form 8-K (File #:  000-33297),  filed with the  Securities and Exchange
         Commission on June 30, 2005, and incorporated herein by this reference.
(3)      Filed  previously  as  an  exhibit  to  the  Registrant's   Form  10-SB
         Registration  Statement (File #: 000-33297),  filed with the Securities
         and Exchange  Commission on October 31, 2001, and again on May 1, 2002,
         and incorporated herein by this reference.
(4)      Filed   previously  as  an  exhibit  to  the   Registrant's   Form  S-8
         Registration Statement (File #: 333-127723),  filed with the Securities
         and Exchange  Commission on August 19, 2005, and incorporated herein by
         this reference.
(5)      Filed  previously as an exhibit to the  Registrant's  Current Report on
         Form 8-K (File #:  000-33297),  filed with the  Securities and Exchange
         Commission  on  April  29,  2005,  and  incorporated   herein  by  this
         reference.
(6)      Filed  previously as Exhibit 10 to the  Registrant's  Current Report on
         Form 8-K (File #:  000-33297),  filed with the  Securities and Exchange
         Commission  on  February  10,  2005,  and  incorporated  herein by this
         reference.
(7)      Filed previously as Exhibit 10.1 to the Registrant's  Current Report on
         Form 8-K (File #:  000-33297),  filed with the  Securities and Exchange
         Commission on July 7, 2005, and incorporated herein by this reference.
(8)      Filed previously as Exhibit 10.1 to the Registrant's  Current Report on
         Form 8-K (File #:  000-33297),  filed with the  Securities and Exchange
         Commission on July 14, 2005, and incorporated herein by this reference.
(9)      Filed previously as Exhibit 10.1 to the Registrant's  Current Report on
         Form 8-K (File #:  000-33297),  filed with the  Securities and Exchange
         Commission  on  August  12,  2005,  and  incorporated  herein  by  this
         reference.
(10)     Filed previously as Exhibit 10.1 to the Registrant's  Current Report on
         Form 8-K (File #:  000-33297),  filed with the  Securities and Exchange
         Commission  on  August  25,  2005,  and  incorporated  herein  by  this
         reference.
(11)     File  previously  as  Exhibit  10.7  to  the  Registrant's   Form  SB-2
         Registration  Statement (File # 333-128288),  filed with the Securities
         and Exchange Commission on September 13, 2005.
(12)     File previously as Exhibit 10.1 to the  Registrant's  Current Report on
         Form 8-K (File #:  000-33297),  filed with the  Securities and Exchange
         Commission on October 7, 2005.

         (b)      Financial Statement Schedules

         Schedules  not listed above have been omitted  because the  information
required  to be  set  forth  therein  is  not  applicable  or is  shown  in  the
consolidated financial statements or notes thereto.


                                      II-5



ITEM 28. UNDERTAKINGS.

         The undersigned registrant hereby undertakes to:

         (1)      File,   during   any  period  in  which  it  offers  or  sells
securities, a post-effective amendment to this registration statement to:

                  (i)      Include any prospectus  required by Section  10(a)(3)
of the Securities Act;

                  (ii)     Reflect in the  prospectus any facts or events which,
individually or together,  represent a fundamental  change in the information in
the registration  statement;  and notwithstanding the forgoing,  any increase or
decrease  in  volume  of  securities  offered  (if the  total  dollar  value  of
securities offered would not exceed that which was registered) and any deviation
from  the  low or  high  end of the  estimated  maximum  offering  range  may be
reflected in the form of prospects  filed with the  Commission  pursuant to Rule
424(b) if, in the  aggregate,  the changes in the volume and price  represent no
more than a 20% change in the maximum aggregate  offering price set forth in the
"Calculation of Registration Fee" table in the effective registration statement.

                  (iii)    Include   any   additional   or   changed    material
information on the plan of distribution;

         (2)      For determining liability under the Securities Act, treat each
post-effective  amendment  as a new  registration  statement  of the  securities
offered,  and the  offering of the  securities  at that time as the initial bona
fide offering.

         (3)      File a  post-effective  amendment to remove from  registration
any of the securities that remain unsold at the end of the offering.

         Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the small
business issuer pursuant to the foregoing  provisions,  or otherwise,  the small
business  issuer has been  advised  that in the  opinion of the  Securities  and
Exchange  Commission such  indemnification is against public policy as expressed
in the Securities Act and is, therefore, unenforceable.

         In the event that a claim for indemnification  against such liabilities
(other than the  payment by the small  business  issuer of expenses  incurred or
paid by a director,  officer or controlling  person of the small business issuer
in the successful defense of any action, suit or proceeding) is asserted by such
director,  officer or controlling person in connection with the securities being
registered, the small business issuer will, unless in the opinion of its counsel
the  matter  has been  settled by  controlling  precedent,  submit to a court of
appropriate  jurisdiction  the question  whether such  indemnification  by it is
against public policy as expressed in the Securities Act and will be governed by
the final adjudication of such issue.


                                      II-6



                                   SIGNATURES

         Pursuant to the requirements of the Securities Act of 1933, as amended,
the Registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form SB-2 and authorized this Registration
Statement  to be  signed  on its  behalf  by the  undersigned,  in the  City  of
Commerce, State of California, on October 7, 2005.

                               BLUE HOLDINGS, INC.
                               (Registrant)

                               By:    /S/ PAUL GUEZ                    
                                    -----------------------------------

                                    Paul Guez
                                    Chief Executive Officer and President
                                    (Principal Executive Officer)

                               By:    /S/ PATRICK CHOW                 
                                    -----------------------------------

                                    Patrick Chow
                                    Chief Financial Officer and Secretary
                                    (Principal Financial and Accounting Officer)

                                POWER OF ATTORNEY

          Each person whose  signature  appears below  constitutes  and appoints
each of Paul Guez and Patrick Chow as his true and lawful  attorney-in-fact  and
agent with full power of substitution and resubstitution,  for him and his name,
place  and  stead,  in any and all  capacities,  to sign  any or all  amendments
(including post-effective amendments) to this Registration Statement and to file
a new  registration  statement  under Rule 461,  and to file the same,  with all
exhibits  thereto,  and  other  documents  in  connection  therewith,  with  the
Securities and Exchange  Commission,  granting unto said  attorneys-in-fact  and
agents,  and each of them,  full power and  authority to do and perform each and
every  act and  thing  requisite  and  necessary  to be done  in and  about  the
foregoing,  as  fully to all  intents  and  purposes  as he might or could do in
person,  hereby  ratifying and  confirming all that said  attorneys-in-fact  and
agents, or either of them, or their substitutes,  may lawfully do or cause to be
done by virtue hereof.

         Pursuant to the requirements of the Securities Act of 1933, as amended,
this  registration  statement has been signed below by the following  persons in
the capacities and on the date indicated.

         SIGNATURE                      TITLE                          DATE
         ---------                      -----                          ----

     /S/ PAUL GUEZ             Chairman, Chief Executive         October 7, 2005
---------------------------    Officer and President
Paul Guez                    

     /S/ PATRICK CHOW          Chief Financial Officer and       October 7, 2005
---------------------------    Secretary
Patrick Chow

     /S/ KEVIN R. KEATING      Director                          October 7, 2005
--------------------------- 
Kevin R. Keating

     /S/ MARSHALL GELLER       Director                          October 7, 2005
---------------------------
Marshall Geller


                                      S-1



                                  EXHIBIT INDEX


EXHIBIT
NUMBER                                    EXHIBIT TITLE
-------           --------------------------------------------------------------

2.1               Exchange  Agreement dated April 14, 2005, among Blue Holdings,
                  Inc.  (formerly known as Marine Jet Technology  Corp.),  Antik
                  Denim,  L.L.C., each member of Antik Denim, L.L.C. and Keating
                  Reverse Merger Fund, LLC. (1)

2.2               First  Amendment  to Exchange  Agreement  dated June 27, 2005,
                  among Blue Holdings, Inc., Antik Denim, L.L.C., each member of
                  Antik Denim, L.L.C. and Keating Reverse Merger Fund, LLC. (2)

3.1               Articles of  Incorporation of the Registrant filed February 9,
                  2000. (3)

3.1.1             Certificate of Amendment of Articles of  Incorporation  of the
                  Registrant filed December 5, 2000. (3)

3.1.2             Certificate of Amendment of Articles of  Incorporation  of the
                  Registrant filed January 5, 2001. (3)

3.1.3             Certificate of Amendment of Articles of  Incorporation  of the
                  Registrant filed May 16, 2005 and effective June 7, 2005. (4)

3.2               Bylaws of the Registrant adopted February 12, 2000. (3)

4.1               Articles of  Incorporation of the Registrant filed February 9,
                  2000. (3)

4.2               Certificate of Amendment of Articles of  Incorporation  of the
                  Registrant filed December 5, 2000. (3)

4.3               Certificate of Amendment of Articles of  Incorporation  of the
                  Registrant filed January 5, 2001. (3)

4.4               Certificate of Amendment of Articles of  Incorporation  of the
                  Registrant filed May 16, 2005 and effective June 7, 2005. (4)

4.5               Bylaws of the Registrant adopted February 12, 2000. (3)

5.1               Opinion of Stubbs Alderton & Markiles, LLP.

10.1              Assumption   Agreement  dated  January  20,  2005,  among  the
                  Registrant, Intellijet Marine, Inc. and Jeff P. Jordan. (6)

10.2              Financial Advisory Agreement dated April 29, 2005, between the
                  Registrant and Keating Securities, LLC. (5)

10.3              License  Agreement dated July 5, 2005,  between the Registrant
                  and Yanuk Jeans, LLC. (7)

10.4              Employment   Agreement   dated  July  8,  2005,   between  the
                  Registrant and Philippe Naouri. (8)

10.5              Service  Agreement  dated May 18, 2005,  between  Antik Denim,
                  L.L.C. and Blue Concepts, LLC. (9)

10.6              First Amendment to Employment  Agreement dated August 1, 2005,
                  between the Registrant and Philippe Naouri. (10)

10.7              Form of  Indemnification  Agreement between the Registrant and
                  each of its executive officers and directors. (11)


                                      EX-1



10.8              License  Agreement  dated to be  effective  October  5,  2005,
                  between the Registrant and Yanuk Jeans, LLC. (12)

23.1              Consent of Weinberg & Company, P.A.

23.2              Consent of Stubbs Alderton & Markiles LLP (included in Exhibit
                  5.1).

24.1              Power of Attorney  (included as part of the Signature  Page of
                  this Registration Statement).

99.1              2005 Stock  Incentive Plan and Form of Stock Option  Agreement
                  of the Registrant. (4)

----------
(1)      Filed previously as Exhibit 2.5 to the  Registrant's  Current Report on
         Form 8-K (File #:  000-33297),  filed with the  Securities and Exchange
         Commission  on  April  15,  2005,  and  incorporated   herein  by  this
         reference.
(2)      Filed previously as Exhibit 2(e) to the Registrant's  Current Report on
         Form 8-K (File #:  000-33297),  filed with the  Securities and Exchange
         Commission on June 30, 2005, and incorporated herein by this reference.
(3)      Filed  previously  as  an  exhibit  to  the  Registrant's   Form  10-SB
         Registration  Statement (File #: 000-33297),  filed with the Securities
         and Exchange  Commission on October 31, 2001, and again on May 1, 2002,
         and incorporated herein by this reference.
(4)      Filed   previously  as  an  exhibit  to  the   Registrant's   Form  S-8
         Registration Statement (File #: 333-127723),  filed with the Securities
         and Exchange  Commission on August 19, 2005, and incorporated herein by
         this reference.
(5)      Filed  previously as an exhibit to the  Registrant's  Current Report on
         Form 8-K (File #:  000-33297),  filed with the  Securities and Exchange
         Commission  on  April  29,  2005,  and  incorporated   herein  by  this
         reference.
(6)      Filed  previously as Exhibit 10 to the  Registrant's  Current Report on
         Form 8-K (File #:  000-33297),  filed with the  Securities and Exchange
         Commission  on  February  10,  2005,  and  incorporated  herein by this
         reference.
(7)      Filed previously as Exhibit 10.1 to the Registrant's  Current Report on
         Form 8-K (File #:  000-33297),  filed with the  Securities and Exchange
         Commission on July 7, 2005, and incorporated herein by this reference.
(8)      Filed previously as Exhibit 10.1 to the Registrant's  Current Report on
         Form 8-K (File #:  000-33297),  filed with the  Securities and Exchange
         Commission on July 14, 2005, and incorporated herein by this reference.
(9)      Filed previously as Exhibit 10.1 to the Registrant's  Current Report on
         Form 8-K (File #:  000-33297),  filed with the  Securities and Exchange
         Commission  on  August  12,  2005,  and  incorporated  herein  by  this
         reference.
(10)     Filed previously as Exhibit 10.1 to the Registrant's  Current Report on
         Form 8-K (File #:  000-33297),  filed with the  Securities and Exchange
         Commission  on  August  25,  2005,  and  incorporated  herein  by  this
         reference.
(11)     File  previously  as  Exhibit  10.7  to  the  Registrant's   Form  SB-2
         Registration  Statement (File # 333-128288),  filed with the Securities
         and Exchange Commission on September 13, 2005.
(12)     File previously as Exhibit 10.1 to the  Registrant's  Current Report on
         Form 8-K (File #:  000-33297),  filed with the  Securities and Exchange
         Commission on October 7, 2005.


                                      EX-2